The Solomon Scandals
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Junk economics or the Onion? $250K a year barely enough for family of four in pricey cities, says Fiscal Times, a Washington Post partner

imageDoes the Washington Post want to be an opinion rag for the rich or serve Washingtonians and Americans as a whole?

Never mind the old adage that newspapers should comfort the afflicted and afflict the comfortable. Here’s one indication that the Post is already a right-wing house organ on certain occasions.

The Post published wacky commentary from its partners at Fiscal Times, founded by Pete Peterson, the multimillionaire deficit hawk—a piece arguing that “Living in high-tax areas on either coast can leave our $250,000-a-year family with little margin.”

“Where does $250,000 a year go?” asked the headline in the Post’s Web edition. Oh, the sufferings of the underclass, as depicted by the media elite! In the current tax debate, $250K is often and rather misleadingly cited as the cutoff between the rich and the rest of us, even though, as FT’s Karen Hube concedes, it’s “six times the national average household income, and just 2.9 percent of couples earn that much or more.”

Even Arnold Kling, an MIT-educated economist, ex-Fed staffer and adjutant scholar with the libertarian Cato Institute, questions the methodology behind Hube’s Post-published piece. “The killer in their analysis is the mortgage, which they say runs about $45K a year. That is crazy. The house must be somewhere close to $1 million.” Actually, the approximately $45K seems to include virtually all housing costs, not just the  mortgage, but Kling’s point still comes through loud and clear.

“Some of the other expenses that the Post imputes to an average affluent couple also seem pretty crazy to me,” Kling says. “If you’re going to do an article like this, you need to explain the details better and make a more persuasive case.”

Among other expenses, the breakdown associated with the Fiscal Times piece says the family of four will shell out $33,000 a year for retirement and the children’s college educations. I’m pro-savings, but $33K is most of the $52,175 median household income in the U.S. (the average is higher, with billionaires skewing the numbers), and if nothing else, what about the reverse mortgage potential of that gold-plated house, if the family is really in a pinch when the parents reach their sixties?  I guess the Post-published message is, “Who cares about overgrown income disparities? Instead we should seek to replicate them in retirement.”

Not all jobs should pay the same—brilliant, overworked doctors should earn much more than goldbricking clerks—but our disparities are among the world’s worst and could turn the Great Recession into the Great Depression II if we’re not in a depression already. Purchasing power of the American middle class and below has plummeted, and I’m talking here about true middle-class people rather than the Obama- or Republican-defined version. What a fraud Obama is as a progressive, assuming he even cares about the P word!

In instances like this we can partly blame Post Publisher Katharine Weymouth and friends, not just Fox News, for the misinformation confusing policymakers and voters, even if Obama himself seems to be perfectly capable of betraying his progressive supporters without the least help from Ms. W. I’m cheering for the Post to succeed in its online initiatives and otherwise—we need Big Media, not just bloggers, to balance out Big Government—but outrages like the junk economics in the Fiscal Times piece will reduce WaPo’s credibility at all levels, even on local stories. Remember, Ms. Weymouth: Arnold Kling may well agree with Pete Peterson on many if not most issues. But he still seems to regard Ms. Hube’s article—theoretically vetted by the Post—as junk or near-junk.

Also of interest: A Quarter of a Million Little Pieces: Pete Peterson & The Washington Post Have a New Fiscal James Frey, by Richard J. Eskow, with the Campaign for America’s Future. Also see October commentary by the Atlantic’s James Fallows on The Self-Pity of the Harvard ‘Poor.’

Related: Past commentary by Post ombudsman Andrew Alexander on the paper’s controversial relationship with Fiscal Times—pointing out that the Post should level with readers about the arrangement. I don’t get the printed Washington Post, but at least the Post’s Web publication of the Hube piece appears not to label it as commentary or tell about FT’s Peterson connection; am I missing something? Screenshot is from the FT version of the story. Believe it or not, the “Down and Out on $250,000 a year” headline is the real McCoy, not a part of a satire from  the Onion. I wonder why the Post didn’t go with the same words. Space considerations? Or was the FT gem too insulting to the average Post reader—too let-them-eat-cake-ish?

To Fiscal Times’ credit: It did publish Woe is Them on $250,000 a Year, by Lawrence Haas, a frequent FT contributor who served as ex-VP Al Gore’s communications director and earlier worked at the White House Office of Management and Budget. But while presenting varied opinions, FT’s basic thrust seems to be on the conservative side. Otherwise how would the Hube disaster have slipped through? I’d love to know how many pieces FT (not to be confused with the Financial Times) has carried on the plight of the jobless. Yes, there are some, but I think FT’s heart is mostly elsewhere.

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