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A Project of The Annenberg Public Policy Center

Tax Cut Ads Clip Some Details


The Democratic Congressional Campaign Committee announced on June 1 a radio ad and robo-call campaign against several congressional Republicans for voting against the American Recovery and Reinvestment Act (a.k.a. the stimulus bill). However, the attacks don’t tell the whole story.

For instance, the ad aimed at Republican Rep. Peter King claim that he "opposed an $800 tax cut and opposed creating or saving 215,000 New York jobs." But King, like many Republicans, never said that. Rather, he said he thought the $789 billion stimulus bill included too much spending.

And the 215,000 jobs (as well as other state specific figures given for other targeted members) are far from a guarantee. Rather, they are calculated from nationwide projections made by President Obama’s advisers in January. We’ve explained before that there are various job creation estimates from different economists and that all should be taken with a healthy dose of skepticism. Obama’s advisers themselves caution that their estimates include "significant margins of error" because of the "obvious uncertainty."

Finally, the radio ad refers to what’s called the "making work pay" tax credit as a "tax cut," but not everyone would describe it that way, as we’ve discussed previously. It is a refundable credit, which means that the money can be sent to taxpayers that earn so little that they do not pay income tax. In fact, the nonpartisan Congressional Budget Office officially considers the credits to be "direct spending," as opposed to a "tax incentive" — or cut. Also, it’s worth mentioning that the full $800 credit cited in the ad is only available to couples. For individuals, it is $400.

The robo-calls more fairly describe the measure when they say that the Republicans opposed an "$800 tax credit for … couples." The credit is not available to everyone, however. Retirees and the unemployed do not qualify. A Tax Policy Center analysis found that 75.5 percent of U.S. households would actually benefit from it.

The targeted Republicans are Reps. Brian Bilbray (Calif.), Charlie Dent (Pa.), Peter King (N.Y.), Thad McCotter (Mich.), Tom Rooney (Florida), and Don Young (Alaska).