Two Demerits for the Post’s Graphic Design Team

When it comes to economics, the Washington Post has trouble differentiating between its news pages and its editorial section. Dean Baker of the left-leaning Center for Economic and Policy Research devotes an entire blog to slamming various media outlets on shoddy economic reporting, and sometimes it seems that half the entries are about the Post. Last Wednesday he took the paper to task for a piece, supposedly a straight news article, that he saw as a thinly veiled “front page editorial about the deficit.” Baker isn’t far off the mark; the Post continually implies that reckless spending, not a recession or the Bush-era tax cuts, feeds the deficit. The economists it quotes uniformly believe that debt, not unemployment, is the greatest threat to the country. Its reporters paint austerity as a grim pill that America must inevitably swallow without acknowledging that mainstream economists encourage the government to spend more, not less, during a slowdown.

The Post's Social Security chart

So I am sure that Baker will have something to say about the Post’s latest front-page hand-wringing, which tells readers that the “payroll tax cut raises worries about Social Security’s future funding.” Who’s doing all the worrying? That eternal newspaper catchall: “some in Washington.” Naturally, reporter Jia Lynn Yang speaks only to economists and special interest groups who are indeed worried, including one advocate who claims the cut is “breaking the kind of firewall that has always existed between the trust fund and the operating fund.” That would be a well-founded concern only if the so-called firewall were more than a metaphor. In reality, we’ve been raiding the Social Security trust fund for years to pay for the government’s everyday expenses. Excess payroll taxes — the surplus that Al Gore wanted to put in a “lockbox” — aren’t sitting in a savings account at the Treasury. Instead, that $2.6 trillion is invested in U.S. bonds no different from the treasuries sold to investors and grandparents looking for a gift for their grandkids. When payroll taxes aren’t enough to cover the benefits paid out by Social Security, those bonds will be redeemed . . . with money from the general fund. The point is, Social Security dollars are a lot more fungible than the Post suggests. The argument that the payroll tax cut endangers Social Security — despite a promise from the government to backstop the $110 cost with general funds — ignores the fact that the program is already inextricably tied to the overall financial health of the government. The single valid point the article makes is an issue more of psychology than of budgeting: Because Social Security is funded by a dedicated tax, it is not forced to compete with other programs — the FDA, aid to the states, etc. — for scarce general fund dollars. Many people in Congress fear, quite legitimately, that relying on the general fund will turn Social Security into just another bloated government program for Republicans to cut. Still, a problem of perception is not necessarily a problem of finances. The New York Times points out that “many budget experts (but not all) and the chief actuary for the Social Security Administration” maintain that the temporary cut will not undermine the program, and that Republican protests to the contrary are less about preserving Social Security than about a sudden insistence on “offsetting” any new spending (even, it seems, disaster-recovery spending). The Times writes that, “[p]olitics aside, the bottom line is that a temporary tax cut is inconsequential to Social Security’s long-term health, from an accounting perspective. The threat remains the financial pressure of an aging population.”

The worst part of the Post’s crusade against deficits, however, is the truly awful chart that accompanies the article. It’s not on the level of Fox News’ blatantly distorted graph of the unemployment rate (see here for more on the kerfuffle), but it’s close. The chart purports to show the effects of the payroll tax cut by plotting the increase in funding from the general fund. Social Security started drawing on general fund dollars in 2010, when benefits exceeded taxes collected and the “trust fund” was tapped for the first time. Thus, until 2010, the line showing the general fund contribution was at zero. Between 2010 and this year, it jumps to $110 billion. That is certainly a lot of money, but the Post dismally fails to put the figure in context. Compared to the $2.6 trillion in the trust fund, $110 is not an astronomical amount. Yet the line on the Post’s chart skyrockets quickly and steeply enough to give even the most sanguine reader heart palpitations. It’s reminiscent of the jagged-peaked graphs pasted on Tea Party posters to stoke outrage about the national debt. Tell me this one doesn’t scare you:

This graph, like the one created by the Post, suggests that Armageddon is just around the corner. The national debt will eat America alive! The payroll tax cut will suck Social Security dry! Steep trend lines, a feature of both graphs, imply that the situation is out of control. Yet the Post makes deliberate choices that ensure the reader has no context in which to place a $110 billion tax cut. The highest value on the y-axis coincides with the cost of the tax cut, so that by the time the line reaches $110 billion, it is literally “off the chart.” Like the national debt, it hits the top of the graph at the far right-hand edge, as if it will increase into infinity. Of course any line which jumps from zero to the top of the graph will appear to skyrocket. On close examination, the Post’s chart actually tells us very little. All the reader can glean from the graphic is that, between 2009 and 2011, the amount contributed by the general fund will reach $110. It doesn’t tell us anything about how large a bite $110 billion will take from the total payroll taxes collected, or how it compares to the size of the Social Security trust fund. Why not extend the y-axis to $2.6 trillion, to show the cost of the payroll tax cut in relation to the value of the trust fund?

The uselessness of the graph and the arbitrary nature of the $110 billion y-axis maximum is perhaps best seen by considering what the Post would have drawn if President Obama’s entire jobs bill, which would have cut the payroll tax by an additional 2 percentage points, had been approved by Congress. In this case, the tax cut would have cost $240 billion, but the graph to illustrate it would have looked largely the same. The values on the vertical axis would simply extend to $240 instead of $110. On the left is my amateur rendering of the original Post chart; on the right is a similar chart illustrating the larger tax cut.

 

 

 

 

 

 

They are almost identical: a flat line and a precipitous increase that ends at the top of the chart. The payroll tax cut shown in the second graph is twice as large, yet the visual representation remains basically the same; only the numbers on the y-axis are different. Unlike in a chart drawn on graph paper, in which the units on both the horizontal and vertical axes are proportional (one square on the x-axis represents the same amount as one square on the y-axis), the scale of the y-axis — whether the numbers go up to $110 or $240 — in the Post chart is completely arbitrary. Because the years marked on the x-axis are unrelated to the dollars shown on the y-axis, one vertical unit can be 20 billion dollars or 50 billion.

Imagine a chart that puts the size of the payroll tax cut in context instead of simply showing it as the largest value possible. Compared to Obama’s $240 billion proposal, $110 billion is a bargain. The red line on the next chart looks a lot less scary when viewed next to the more expensive scenario:

Perhaps most helpful would be a chart that put the cost of the tax cut in the context of the total payroll taxes Social Security will take in. According to the government’s own data, which the Post links to but declines to use in its chart, the payroll tax generated roughly $545 billion dollars in 2010. Extend the y-axis to $545 billion, and suddenly the line from zero to $110 billion becomes a gentle slope: a wheelchair ramp, not a mountainside. In fact, the incline would be one-fifth as steep as the graph produced by the Post. The numbers would be the same, and the graph would convey the exact same information as the one created by the Post. Yet it would present a much less alarmist picture.

All of these graphs are technically accurate. However, by playing with the scale of the vertical axis, the Post can paint the payroll tax cut as either profligate or fiscally prudent. It seems much more helpful to show the tax cut in relation to the total taxes collected, but none of the charts really tell the reader anything new. The fact that Social Security will draw $110 billion from the general fund is not one that needs graphic elaboration. But by isolating the $110 billion value, the Post does its readers a disservice. It’s as if the newspaper wrote a story about a teenager purchasing her first cell phone: Suddenly, she has a new monthly bill for $110. Will she go broke trying to pay for her Blackberry? To answer that question, it helps to know that she earns $545 each month from her job at McDonald’s. The phone bill might stretch her budget or preclude a few shopping sprees, but it’s not the end of the world.

Unfortunately, the attitude at the Washington Post is that overspending and national debt may well be the “end of the world.” That’s a fair opinion to have, and certainly one that a lot of Republicans in Congress subscribe to. But it shouldn’t be the basis of an ostensibly neutral news article.

Republicans Cash Social Security Checks, Too

Statements like this, from an Associated Press article about the “debt showdown” (thanks, AP, for that added bit of drama) crack me up:

Republicans have insisted that entitlement programs such as Medicare need substantial changes, but have loudly objected to any revenue provision that could be deemed a tax increase. Democrats, eager to keep changes to their cherished health care programs to a minimum, have demanded that any plan must have new tax revenue.

Their cherished health care programs? Really? Remind me who was yelling at the government to keep its “hands off my Medicare!” Yup, that would be angry Tea Partiers, self-declared arch enemies of “big government.” Republican politicians — and today’s politicians are nearly all millionaires — may not give a fig about health care programs or Social Security, but let me assure you, the average 65-year-old Republican taxpayer cares. That average Republican may not admit that he or she benefits from government programs (the home mortgage deduction and child tax credit are called “entitlements” for a reason), but take away Grover Norquist’s hefty bank account and even that paragon of tax phobia would be crying for his Social Security check.

The idea that Democrats have “won” something in the debt ceiling negotiations by preserving Medicare and Social Security is ridiculous. If Republicans gutted the programs, a la Paul Ryan’s version of reality, voters would be calling for their heads. Anti-government rhetoric sounds great until the cuts become personal. This notion that the GOP is “giving in” on health care and social safety net programs is a convenient diversion; it suggests that conservatives are compromising when in fact they are doing nothing of the sort. A husband who “compromises” with his wife by volunteering to mow the lawn while she washes the dishes — when, deep down, he’d pay to drive the ride-on mower for an hour — is not sacrificing anything at all. We need to move beyond the idea that Democratic voters are the only ones who care about “cherished health care programs.” There’s a lot more cherishing going on than the GOP is willing to admit.