Townhall Baloney

The President's  stop  at a "Townhall" at Facebook is on Wednesday was a campaign event staged as news.   I am not sure why it merited any news coverage.   In the one hour and six minute event there was not one spontaneous moment.  These kinds of events seem to be a favorite of many politicians especially this one.  Each of the questions had been screened, in advance.   You can actually imagine the campaign guys reviewing the questions for their campaign value.  From the opening this was a staged event - "My name is Barack Obama, and I'm the guy who got Mark to wear a jacket and tie. (Applause.) Thank you. (Laughter.) I'm very proud of that. (Laughter.) "   (From watching the video it is not clear whether the President's staff used an applause sign or a laugh track."
Here are some comments from the event (with my comments attached)
"The main reason we wanted to do this is, first of all, because more and more people, especially young people, are getting their information through different media. And obviously what all of you have built together is helping to revolutionize how people get information, how they process information, how they're connecting with each other."   But more importantly this has the appearance of a live appearance, without the risks.

The first question from Mark Zuckerberg sets up a narrative that is partially false - How did we get here?   The President replies "What happened then was we went through 10 years where we forgot what had created the surplus in the first place. So we had a massive tax cut that wasn't offset by cuts in spending. We had two wars that weren't paid for. And this was the first time in history where we had gone to war and not asked for additional sacrifice from American citizens. We had a huge prescription drug plan that wasn't paid for. "  The diagram at the left shows the actual Federal debt.  Notice that in the last year of the Bush presidency the debt climbs quickly - but during the first few years of Obama it grows substantially.
The President then goes through a rap about the budget - "What the Republicans right now are saying is, number one, they can't agree to any increases in taxes, which means we'd have to cut out -- of that $4 trillion, all of it would come from education, transportation -- areas that I think are critical for our long-term future."  In the lead up to this part of his response he makes a series of false comparisons that suggest that unless we raise taxes all sorts of key programs will be eliminated.
Zuckerberg then goes on to the housing crisis, which most sane economists argue was caused in large part by government policy (remember that S&P also put Fannie and Freddie on credit watch).  - "What we've really seen is the housing market, which was a bubble, had greatly over-inflated in all regions of the country. And I know I probably don't get a lot of sympathy about that here because I can only imagine what rents and mortgages you guys are paying."  His response is government can help you renegotiate your mortgage bot that we need to think more creatively about whether there should be a federal housing policy.  Here is a great example of that thinking " There are certain communities with high foreclosure rates where what we're trying to do is see if can we help state and local governments take over some of these homes and convert them and provide favorable terms to first-time home buyers."

The key campaign ad speech is contained in a question about Congressman Ryan's proposal on the budget.  "The Republican budget that was put forward I would say is fairly radical. I wouldn't call it particularly courageous. I do think Mr. Ryan is sincere. I think he's a patriot. I think he wants to solve a real problem, which is our long-term deficit. But I think that what he and the other Republicans in the House of Representatives also want to do is change our social compact in a pretty fundamental way. "  He then goes on to argue that by changing the tax system that somehow wealthier people will sneak out of their tax burden. The President will try to misrepresent in fundamental ways what the Ryan plan tries to do.  A linchpin of his argument is on taxes.  The chart at the left compares tax rates and share of the burden paid from the end of the Carter administration.  It clearly shows that as rates are lowered the wealthier pay a higher percentage of the total tax burden.   However, there is one caveat in the data.  In the last 30 years, as a result of tax reform, an increasing percentage of taxpayers bear no income tax burden.  Thus, the percentage of taxes paid by the top bracket would go up some, on the natural.