Let’s Stop Lying About Money

Why do I drone on and on about reporters who don’t adjust for inflation when they show dollar figures over time? Well, consider the following sentence from the first op-ed that hack economist Stephen Moore wrote as a member of the Wall Street Journal editorial board:

In the 1980s, President Ronald Reagan chopped the highest personal income tax rate from the confiscatory 70% rate that he inherited when he entered office to 28% when he left office and the resulting economic burst caused federal tax receipts to almost precisely double: from $517 billion to $1,032 billion.

This is wrong. Partly that’s because Moore didn’t even use figures from Reagan’s first and last years in office. But mainly it’s because he didn’t account for inflation or population growth. Once you do that, it turns out that federal tax receipts actually went up 14 percent on Reagan’s watch, or 1.7 percent per year:

Moore’s statement isn’t  just wrong. It’s a lie because he knew perfectly well it was wrong and said it anyway—and I savaged him for it at the time. But if it’s wrong for Stephen Moore, it’s wrong for everyone else too. And just like Moore, if you know better, it’s a lie. My goal is to make sure that everyone knows better so that we’ll all stop lying, either deliberately or otherwise.

Unless you have a very specific, technical reason for using nominal dollars—and they exist!—always adjust for inflation. Generally speaking, you should usually adjust for population growth too. Stop lying!

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DEMOCRACY DOES NOT EXIST...

without free and fair elections, a vigorous free press, and engaged citizens to reclaim power from those who abuse it.

In this election year unlike any other—against a backdrop of a pandemic, an economic crisis, racial reckoning, and so much daily crazy—Mother Jones' journalism is driven by one simple question: Will America will move closer to, or further from, justice and equity in the years to come?

If you're able to, please join us in this mission with a donation today. Our reporting right now is focused on voting rights and election security, corruption, disinformation, racial and gender equity, and the climate crisis. We can’t do it without the support of readers like you, and we need to give it everything we've got between now and November. Thank you.

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