Paul L. Caron

Wednesday, June 22, 2011

David Cay Johnston Joins Reuters

Johnston_2After writing a column for Tax Notes for three years (following his 13-year stint at the New York Times), Pulitzer Prize-winning tax journalist and author David Cay Johnston will write a twice-weekly tax column for Thomson-Reuters, and also provide television commentaries.  (David will continue in his dual appointment as Distinguished Visiting Lecturer at Syrcause University's College of Law and Whitman School of Management.) From The Wrap:

Johnston’s column is launching the week of July 5 and will appear on the new Thomson Reuters News & Insight resource for tax and accounting professionals as well as the Reuters wire and, according to executive editor Amy Stevens.

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Congratulations, David! I sometimes disagree over omission of some opposing arguments from your articles, but you have an admirable passion for factual accuracy of every bit of information you use.

You are much closer to the Tax Policy Center's gold standard of objectivity than to Paul Krugman's gold standard of rabid partisanship. This is praiseworthy given the strong financial benefits of strident presentation vs. boring "on the other hand" articles.

Posted by: AMTbuff | Jul 3, 2011 5:57:27 PM

@ Woody, you have declared here quite clearly that without reading fully you passed judgement, a clear declaration of your lack of regard for fact.

Again, If you find an actual empirical error -- as opposed to facts and my interpretations that do not fit your ideology (and that you wrote here you wish were suppressed) --it will be corrected forthrightly.

Posted by: David Cay Johnston | Jun 24, 2011 6:20:17 AM

David, that type of response is so typical of you...making an irrational conclusion with incomplete data.

Posted by: Woody | Jun 23, 2011 7:37:40 PM

@ Woody, thank you for acknowledging that you care not a whit about facts.

Posted by: David Cay Johnston | Jun 23, 2011 11:25:01 AM

David, I didn't even read all of that ranting and phony justifications. If you're going to write for the public, you shouldn't be so thin-skinned.

Posted by: Woody | Jun 23, 2011 8:11:25 AM

Now Reuters will be worth keeping a close eye on.

Posted by: Phineas Baxandall | Jun 23, 2011 6:34:11 AM

@ Woody, thank you for the links to specifics, which I had not seen (and you will notice I did not post at those links).

Please note that others (none of whom I know) defended my work and showed that some of the assertions of factual errors are false, as indeed they are.

The first critic at one of the links, Ed D, thinks that Internet searches are reliable sources of information. No wonder he has his facts wrong. My 8th child told me when she was in junior high that the Internet not a reliable source of anything, but then I raised my kids to not be gullible.

Rep. Ryan has been directly quoted saying he gives his interns Atlas Shrugged, as a search of reliable sources would have shown Ed D. Other reporters (see Alex Beam, for one example cited by a poster defending me) have written about this, too. And, yes, I have slogged through that badly written screed Atlas Shrugged, as well as The Fountainhead, though that was decades ago.

You can quibble, I suppose, over my use of the word “required.” I confess I do not know whether Ryan hands his subordinates Atlas Shrugged with the expectation that it will be read or as doorstop.

Ed D also writes that I made no mention of the 28 percent tax rate under Reagan, suggesting foul intent, and yet my piece states:

When Reagan was elected president,
the top marginal tax rate (the tax rate
paid on the last dollar of income earned)
was 70 percent. He cut it to 50 percent
and then 28 percent starting in 1987. It
was raised by George H.W. Bush and
Clinton, and then cut by George W.
Bush. The top rate is now 35 percent.

So, Woody, no error to correct. Let’s press on.

You, Michael A. Livingston, Jerry, DLN, S and Sandy P all make statements about your beliefs, but do not cite any specific errors, the point of my post about yours. And several posters including DLN, make specious statements lacking a factual basis.

Yooper, while citing no error, does raise a good point. Of course GE pays other taxes. Yooper may also want to read my column on the 71% cash income tax rate of The New York Times Co.

Then there is Shotgun, who falsely writes that the rich (who he defines as $250k of income) pay most of the taxes. Had he read my piece he would know why that is utter nonsense.

Shotgun also writes with the assumption that I favor borrow-and-spend, obviously not having read my columns on this very issue including my invention of Undertaxed Freedom Day to illustrate how much of our taxes go to interest.

BTW, unlike Shotgun I don’t think $250k (even of taxable income) makes one rich, but it does put you in the top 2 or so percent of earners. However, that is also far from, say, the ever changing Top 400 who, in the down year 2008, earned that much every eight hours or so around the clock.

Unmentioned in the complaints on one of my Ryan plan columns is that – using the same data Ryan relied on to project his tax cost savings – private spending would rise by five or eight times what he would save taxpayers. Read my column “Ryan's $34 Trillion Tax Folly” at

Strange the politician who tells you he will save you a dollar in taxes, but at a cost of five or eight times that in private spending, as I point out with an analogy in my column.

glenlyon asserts that the data I present from the widely acclaimed Saez-Piketty tables is flawed since the lowest possible income is zero. That, too, is nonsense.

People can and do have negative incomes both for tax purposes and in terms of real economic losses. I have in my files tax returns or abstracts of people who routinely report negative incomes and whose data got into the public record. See Page 84 of my casino book Temples of Chance, which shows that Donald Trump’s income went negative in 1978 and went negative in the millions of dollars in 1979, as he disclosed to regulators.

And glenlyon goes off on tangents that are not germane to the well-established fact that the pie is sliced differently and the relative income growth rates of the bottom 90 percent and those further up the earnings ladder have changed.

Jpe raises a point about hedge fund deferrals that we cut from the alternative weeklies syndicated piece for space. I decided it could be cut because the laws jpe cites (which are in part due to my work) have not yet resulted in any statistical data that will allow an assessment of whether they are effective or shams. Jpe has concluded, with no evidence, that they were effective.

Remember my NYT piece quoting a Big Four partner urging Bermuda tax deals, while the Twin Towers were still smoldering, because she said profits trump patriotism? That resulted in five-hour floor debate where House Rs upped the ante on the Ds in cracking down on Bermuda tax deals, but then inserted a provision that made it a sham? So, when we have the data I will scrutinize it to see if the changes jpe cited are effective or illusory, but will not until then make the kind of assumptions jpe does because I deal in empirical – that is, provable and verifiable – facts.

So I see a lot of dislike based on ideology of the posters, a lot of factual errors by critics. Can you point to a specific factual error?

You, Woody (whoever you are), clearly read my work through an ideological lens, which explains some of your objections and your wildly inaccurate assumptions.

For example, one of your posts implies I have an anti-Republican perspective. That’s really strange, but revealing about how you operate from assumptions. Since voter registration records are public (I vote in Monroe County, New York) please look mine up.

Instead of dealing in specific facts your posts use in broad characterizations and labels.

And you label me a dedicated leftist, as you put it, which is bizarre unless you think that markets are a liberal idea (as I have had people at two public lectures tell me, BTW) and that progressive taxation is leftist.

Of course, progressive taxation is arguably the oldest surviving, and therefore in the classic sense most conservative, principle in Western Civilization. It was embraced by Plato, Aristotle, John Locke (in extremely mild form), Adam Smith, Karl Marx (in extremely strong form) and even George W. Bush.

Progressive taxation is a half millennium older than the au courant (and factually wrong) notion that the Judeo-Christian god has decreed that marriage must be between one man and one woman, something anyone who received even superficial to religious instruction as a child should know is nonsense.

Experience has taught me that people who label me a leftist lack historical knowledge and often believe silly things, such as that the Boston Tea Party was a protest against high taxes (a really laughable bit of nonsense), that Marx invented progressive taxation (he came to that party about 2,300 years late), that businesses cannot create jobs unless they get subsidies and incentives (a widely held view based on actions of politicians at all levels of government) and that the rules we have today are the natural state of affairs, rather than constructs reflecting current societal values mixed with lack of knowledge about those policies (see my next book, THE FINE PRINT).

And, Woody, I also believe in the marketplace of ideas. I went from a childhood where I had to go to work fulltime at 13 to being prosperous through competing in the marketplace, a poster boy for the mythical Horatio Alger myth.

My work (and my lodging management business) get put into a competitive marketplace, imperfect for sure but the best mechanism humans have come up with so far for both rewarding work and governing ourselves. And my opinions go where the facts go, and change when the facts change or I develop some new understanding, which is often, just as my business plan changes with market conditions.

Those who close their minds to facts and interpretations of their meaning, as you wrote that you have done regarding my works, are free to do so.

However, your suggestion that my works should not be cited at this blog smacks of authoritarianism, not liberty or democracy. And while you say it is easy to “invalidate” my works you fail to do that with any facts, relying only on your self-described closed opinions and assumptions to label rather than rebut.

Your writing raises the question of whether you believe in freedom and the marketplace of ideas or in enforcing an ideology that you favor.

Have you built your beliefs on such a weak foundation, one lacking empirical support, that what you wish to be true cannot survive in the competitive market of ideas?

Again, if you can show actual factual error in my work it will be corrected forthrightly, a policy I have held for my entire career and that I have the clips to prove I follow.

Posted by: David Cay Johnston | Jun 23, 2011 5:19:22 AM

David, reference the comment sections of previous articles of yours that Paul has provided. (Recent Samples: Johnston: 9 Things the Rich Don't Want You to Know About Taxes
and Johnston: The Ayn Rand Tax Plan) You take positions that you hope to be true, based upon your leftist ideology, and then try to manipulate data to support that. Your works were so regularly dismantled, that I finally quit reading them. I think that Paul posts your articles, those of Bruce Bartlett, Paul Krugman's, and some from feminist professors just to torture rational thinkers. Nevertheless, congratulations on your new position, but try to be objective in your future writings.

Posted by: Woody | Jun 22, 2011 9:43:44 PM

@ Woody, if you can find any error in my work present it and it will be corrected forthrightly.

Posted by: David Cay Johnston | Jun 22, 2011 7:49:09 PM

That's funny. I had the exact opposite reaction.

Posted by: Marcus | Jun 22, 2011 1:03:37 PM

Thomson-Reuters just lost credibility.

Posted by: Woody | Jun 22, 2011 9:50:46 AM

Good luck David!!!

Posted by: mike livingston | Jun 22, 2011 6:23:51 AM