And the N.Y. Times Wonders Why Circulation Continues to Decline?
Our friend and past guest on Pundit Review Radio Tom Blumer of Bizzyblog got in a little dust up with a certain NY Times Reporter this past week named David Cay Johnston who wrote a very questionable and suspect piece entitled: “Average Incomes Fell for Most of 2000-2005.” Our friend Tom looked a little deeper into the numbers and came up with a very different conclusion. Seems as though Mr. Johnston conveniently omitted some fairly significant pieces of information from his calculations.
It will take a few minutes to get through but is well worth it if you want to see why the mainstream media- who have gotten away with its distinct brand of agenda driven journalism for so long- loathes many in the New Media Blogsphere who meticulously check their work- and often expose their innacuracies and outright lies.
Writers at the Times and elsewhere could get away with fudging the numbers and skewing the data to advance their leftist political agenda, but subject matter experts like our friend Tom Blumer and Patrick Frey of Patterico’s Pontifications who has made a carreer out of forcing the LA Times to issue retractions have been very successful exposing their intellectual laziness, shoddy work, and biased coverage.
Tom has also informed me that he is trying to get the Times to issue another retraction/correction from the Public Editor and the Standards Editor demanding a correction to the Times’ six-month old claim, never retracted, that we were (and I suppose, since never retracted, still are) in a manufacturing recession which you can read here
The comment section is very interesting as well. Great job Tom. Way to go!
August 24th, 2007 at 7:10 am
There is not a single fudged number in my article, which accurately reports precisely what the official government data show.
If you can find any error — or even a fudged number, as you put it — it will be corrected.
The blogger whose work you cite is not familiar with this data, about which I write an article each year when it is released.
As I will show below, nothing in my report was in any way misleading by omission, as you write above. Indeed, I take such care with my work that I prepared two dozen spreadsheets to thoroughly analyze the data before writing about it to make sure it was rounded.
In contrast to the care that I take, did you even read my article before asserting that I lack integrity?
Let’s go to the numbers:
What happens if we look at income groups in more detail than I did in my piece?
The size of these groups changed so one has to be careful in looking at the numbers, which is why I did not go into this in my 900-word article.
Total adjusted gross income for all Americans grew from 2000 to 2005 by $214.5 billion or 3.1% in real terms.
It was the first time in five years that total income grew in real terms, an extraordinary change in the data, which I have analyzed going back to 1945, as I reported.
The three groups in below were in 2005 88% of taxpayers with adjustd gross income, 10 percent and 0.23 percent.
Change in real terms 2000 to 2005:
# returns Total $ Average $
$1 to $100k 0.7% (5.7%) (-6.3%)
$100k to $1m 32.6% 16.7% (-12.0%)
$1m plus 26.8% 10.9% -(12.5%)
addendum
$1 to $1m 3.4% 2.1% (-1.2%)
$1m plus 26.8% 10.9% (-12.5%)
What the figures show is that the number of people with adjusted gross incomes grew in all cases, total incomes grew only for those above $100,000 and average incomes fell in all cases.
And, as I reported, of the gains, nearly half (47 percent) went to the very narrow slice of Americans with incomes of $1 million or more.
It is a standard convention to compare income data to the peak of the last economic cycle.
The following from my article is also highly relevant to your attack on the integrity of my work:
****The White House said the fact that average incomes were smaller five years after the Internet bubble burst “should not surprise anyone.”****
My article is posted at
http://www.nytimes.com/2007/08/21/business/21tax.html
The data, if you want to do your own analysis, is the Table 1.4 series at
http://www.irs.gov/taxstats/indtaxstats/article/0,,id=134951,00.html
David Cay Johnston
davidcay@nytimes.com
David Cay Johnston
davidcay@nytimes.com
August 24th, 2007 at 8:04 am
Through various statistical machinations (the bogus hedonic method), government-reported inflation (CPI, core CPI) has been artificially deflated and is probably 300-400 basis points lower than the actual inflation rate of 6-7%. In real terms, the average American is even worse off than David has reported. The faux boom of the past 10 years has come on the heels of excessive debt and credit growth (a.k.a. monetary inflation - M2 growth), the same reckless monetary policy that eventually plundered Weimar Germany.
Far from scrutinizing all of the “old” media, Gregg is a partisan to the core who only attacks those outlets perceived to be liberal or left-leaning. He has never criticized the WSJ editorial page, the Weekly Standard, the National Review or even FOX News, a blatant propaganda arm of this corrupted White House.
August 24th, 2007 at 11:22 am
Mr. Johnston,
Thanks for taking the time to comment on the post. I give you a lot of credit for that.
Firstly, I never said you specifically “fudged” your numbers in my post. So let’s focus on what was actually said before you atrribute to me things I never said. What I said was: “David Cay Johnston who wrote a very questionable and suspect piece.”
The key words were carefully chosen “quesionable” and “suspect” which is how I would characterize your piece. I used word “fudged” saying specifically:
“Writers at the Times and elsewhere could get away with fudging the numbers and skewing the data to advance their leftist political agenda…” And you can call it what you want, but I have reviewed your work in depth and happen to concur with Mr. Bloomer’s assessment of your work being shoddy, suspect,and misleading.
Specifically I agree with Mr. Bloomer’s two main pts in his original post that;
“The more important news by far is that the real increase in Revised AGI in both 2004 and 2005 is greater than during either of the final two good years of the Clinton economy;
The real decreases in 2001 and 2002 occurred largely because of the bursting of the Clinton-Era dot-com bubble and the September 11 terrorist attacks. The dot-com bubble got mentioned by the Times in the context of quotes from White House sources (the better to make it look like excuse-making); Johnston and the Times made the September 11 attacks invisible.
“An obvious omission: The IRS does not include the Earned Income Credit (EITC) in its compilation of Revised AGI, even though the EITC represents real money that either reduces other taxes or goes directly into beneficiaries’ pockets. Total EITCs claimed increased from $19.5 billion in 2000 to $42.4 billion in 2005, largely because of the credit’s expansion in the Bush tax legislation of 2001 and 2003. Spread over the annual average of roughly 132 million tax returns filed during that period, the $22.9 billion increase in the EITC ($42.4 bil minus $19.5 bil) amounts to over $170 per return.
“Don’t forget the tax-rate cuts: Now add the benefit of the Bush rate cut in the lowest bracket, which has benefited all but the very top few percent of taxpayers. Since its inception in 2001, that rate cut from 15% to 10% — never mind the reduction in higher brackets — has reduced taxes for most single filers by at least $350 per year, and for most joint filers by at least $700.
“The EITC expansion, the cut in the lowest rate just noted, and the reductions in the rates applied in higher income brackets, when combined, surely more than make up for the $477 difference ($55,715 minus $55,238) between 2000’s and 2005’s Revised AGI amounts. So while average pre-tax income may have fallen, average after-tax income has risen — even during the Times’ artificially induced period of analysis.”
Mr. Johnston, these are substantial omissions here and it was correct for Mr. Bloomer to point them out. You can call them what you will but you have yet to credibly rebut Mr. Bloomer’s very valid analysis of your work above.
And if you want to garner credibility don’t attribute to me things I never said. I never said in my post (nor did Mr. Bloomer) that you lack “integrity.” Instead of accusing Mr. Bloomer and others of calling you names, why don’t you try to effectively rebut the specific observations and analysis of your work authored by Mr. Bloomer.
Gregg
August 24th, 2007 at 1:36 pm
The following comment is from Tom Blumer of BizzyBlog,
David, (some of) My beefs were:
- the last 5 years being presented as flat with no acknowledgment that the last two have been strong.
- This statement: “The fact that average incomes remained lower in 2005 than five years earlier helps explain why so many Americans report feeling economic stress despite overall growth in the economy.” You didn’t express any conceivable doubt that the statement you made might not be true. As noted at my place, I think people focus on more recent results even if they don’t read up on things. 2004 and 2005 were very strong years for real income growth, and I’ll be very surprised if 2006 doesn’t come in almost or just as strong.
- Not determining, or at least discussing, whether after-tax incomes are up or down, or a statement to the effect that the IRS data only look at pretax numbers, and that after-tax numbers might show a different result.
I DELIBERATELY didn’t go into the income-distribution items you had in your article or comment on them, because they were too complex to address in the time I had, and because I believe upcoming Census Data for 2006 by quintile will give us a better, more recent, and more consistent picture. I realize Census data has its issues, but at least the methodology is consistent from year to year. Looking at tax returns over time and trying to compare has the huge difficulty that the laws change in many years, and significantly.
And David, we’ve been through this “integrity” argument. Gregg is not, as I am not, questioning your integrity. We’re questioning what you chose to report and how you reported it, and whether there’s a conscious or sub-conscious agenda behind it. I know you think that such an assertion goes to your integrity and honesty. As far as I’m concerned, it doesn’t, but I can’t help it if you take it that way, just as you can’t help it if, from your perspective, I took a comment you made elsewhere a couple of days ago the “wrong” way. I’ve made it clear at my place what my position on this matter is.
I sure as heck don’t question your resume or your accomplishments, as they are very significant. I’d like to think that your report was a one-off where you let your possibly valid concerns about income distribution as reported on tax returns get in the way of reporting the big picture fairly, accurately, and more completely.
Tom Blumer, BizzyBlog.com
August 25th, 2007 at 4:08 am
Gregg,
You started off describing my Aug. 21, 2007, article as “very questionable and suspect.”
You appear to enthusiastically endorse Mr. Blumer’s work generally and especially so in the case of his critique of my article.
You call him “a subject matter expert” and it would seem that you include him among those whom you praise because they “meticulously check” the work of mainstream journalists “and often expose their innacuracies and outright lies.”
I use the words “appear” and “seem” out of an abundance of caution because you insist all of this does not amount to your questioning my integrity and because you want to fudge on your use of the word “fudge.”
You also advise your readers that taking the time to read Mr. Blumer’s critique of my work is “well worth it.” That sure does seem to indicate you endorse his work.
You also wrote:
***I have reviewed your work in depth and happen to concur with Mr. Bloomer’s assessment of your work being shoddy, suspect, and misleading. Specifically I agree with Mr. Bloomer’s two main pts in his original post….”
So I think it is fair to say that you have in fact called my work “shoddy” and you called Mr. Blumer’s “very valid,” though you may have a linguistic loophole to escape anyone saying that you have described his work as “meticulous.”
In light of all of this, I suggest you call up the web pages of Mr. Blumer and read my post about the specific points which you describe as his “very valid analysis” and on which you so clearly rely.
By the way, you misspelled Mr. Blumer’s name seven times, so I take it you would not count yourself among the meticulous, especially since you refer to him as your friend.
August 25th, 2007 at 5:28 pm
Gregg:
If you call someone unappealing to look at and sort of icky, don’t get defensive if they say that you called them ugly.
To a journalist (and I used to be one), the terms “conventiently omit”, “inaccuracies and outright lies” and “fudging the numbers and skewing the data” when used in reference to someone’s work (and yes, you link his work and the liberal media) means you are questioning his integrity.
Stand up for your viewpoints. Don’t hide behind semantics.
August 26th, 2007 at 10:37 am
David,
I stand by my original opinion that your piece was very misleading (and I think intentionally so) in that you conveniently omitted a number of highly relevant data points which could be construed as “convenient omissions,” “skewing the numbers,” or “fudging” depending on one’s subjective definition. And if you think that somebody who engages in direct and intentionally deceptive and misleading economic analysis lacks integrity than perhpas I am saying that you lack integrity (although I never directly stated you did). Regardless, I stand by my original assessment of your work and will not apologize for it. You have still yet to rebut Mr. Blumer’s original analysis as he and I have both pointed out which again are as follows:
the last 5 years being presented as flat with no acknowledgment that the last two have been strong.
- This statement: “The fact that average incomes remained lower in 2005 than five years earlier helps explain why so many Americans report feeling economic stress despite overall growth in the economy.” You didn’t express any conceivable doubt that the statement you made might not be true. As noted at my place, I think people focus on more recent results even if they don’t read up on things. 2004 and 2005 were very strong years for real income growth, and I’ll be very surprised if 2006 doesn’t come in almost or just as strong.
- Not determining, or at least discussing, whether after-tax incomes are up or down, or a statement to the effect that the IRS data only look at pretax numbers, and that after-tax numbers might show a different result.
So if you would like to rebut those very legitimate points I would be happy to consider them. But so far you have yet to posit neither a cogent nor a compelling rebuttal as to why you conveniently omitted these data pts which would have significantly altered your headline. Perhaps that is the real reason you conveniently omitted them?
And Terry, I hardly need you to chide me for not “standing up for my viewpoints.” That doesn’t really add anything substantive to the debate.
Gregg
August 26th, 2007 at 6:56 pm
No, but it could help you in the future to not play semantics and word games in your answers. You have a tendency to hide behind semantics and talk around answers. You debate like a 1950s communist.
August 27th, 2007 at 4:11 pm
I play “semantics” and word games do I? I sound like a 1950s “Communist” do I. Sorry Terry if I can’t really take you seriously. That doesn’t really deserve a serious reply. But thanks for acknowledging that you had nothing substantial to add to the debate.
Gregg