Subject: "Political Dynamite" Fails to Explode:

Extreme proposals of Treasury's O'Neill mostly unreported

Forwarded by Jack Kolb via Varda Novick:

Fairness & Accuracy in Reporting Media analysis, critiques and news reports

June 13, 2001

When a high-level government official calls for drastic

changes in U.S. law, it ought to be big news. But in an interview

reported by the Financial Times' Amity Shlaes (5/19/01 & 5/22/01),

treasury secretary Paul O'Neill called for sweeping changes in U.S. tax and

social policy, and some three weeks later, those statements have made

hardly a ripple in the U.S. media. Most Americans have probably not heard a

word about them.

In the interview, O'Neill called the current U.S. tax

system "an abomination" that required changes to its "very

structure." His preferred changes? O'Neill "absolutely" supports the elimination

of taxes on corporations-- and the shifting of the tax burden to

individuals, saying government would work better if it "collected taxes in a

more direct way from the people."

He also called for the abolition of Social Security and Medicare, on the

grounds that "able-bodied adults should save enough on a regular basis so

that they can provide for their own retirement, and, for that matter,

health and medical needs." In fact, O'Neill believes the U.S. should

reconsider the whole purpose of taxation: "National defense is a federal

responsibility," Shlaes paraphrases O'Neill as saying, "but all other

outlays need review."

And O'Neill assured Shlaes he was not speaking only for himself: "Not only

am I committed to working on this issue, the president is also intrigued

about the possibility of fixing this mess."

The Financial Times described O'Neill's comments (approvingly) as

"radical" and "political dynamite." Yet the story has so far failed to

take hold in the U.S. press.

Three columnists at New York's Newsday noted O'Neill's remarks: Robert

Reno (who said the Treasury Secretary "comes across as a man who has paid

a lot of taxes and clearly resents it"-- 5/27/01) Marie Cocco (5/31/01)

and Paul Vitello (5/24/01). An obviously irked Vitello took it the

furthest, actually calling O'Neill's spokesman at Treasury to confirm that

these were not "made-up quotes":

"The secretary didn't really mean to say that no matter how old, no person

who has paid into the Social Security system all his or her life would be

entitled to benefits until he or she is physically no longer able to work?

He didn't really mean to say that ExxonMobil and Time Warner should be

treated as we treat the church-- as tax exempt?

"'Yes,' said the spokesman, 'that is our position. The quotes were all

accurate.'"

Thomas DeFrank of New York's Daily News also reported O'Neill's comments

(5/22/01), but he apparently got a different response from the Treasury

Department. "Treasury spokesman Rob Nichols said O'Neill's comments on

Social Security reflected his personal views, not the Bush

administration's," he noted.

Outside of local New York papers, the story was harder to find. Cox wire

service reporter Scott Shepard filed a story (5/20/01), which noted only

O'Neill's description of the tax system as an "abomination" and the claim

that the president was "also intrigued" about major changes, including

cutting corporate taxes. A short piece in the May 22 Investor's Business

Daily ("A Whiff of Reform in the Air") did the same, and was echoed in its

approving tone by a column in the May 23 Washington Times ("Signals for

Tax Repair?").

O'Neill has made several television appearances since the Financial Times

interview, but a search of the Nexis.com database turned up just two TV

references to the remarks, neither on a Big 3 network. The Financial Times' own Robert Thomson teased his paper's interview

at the end of a May 18 appearance on CNNfn's "The N.E.W. Show" whose main

subject was the Lucent/Alcatel merger. And Fox News Sunday host Tony

Snow asked O'Neill about the idea of "getting rid of the corporate income

tax" on June 3. (O'Neill declined to answer, saying only that "we need

to fundamentally look at the way our tax code works.")

What about the country's major outlets, the place one would look for a

story of such import? So far, O'Neill's radical statements have made it

into the New York Times only in an op-ed by Democratic partisans James

Carville and Paul Begala (5/27/01). USA Today ran an Associated Press

column (5/22/01) that placed O'Neill's calls for eliminating taxes on

corporations at the end, after discussion of estate taxes and "simplification" of the tax system, and noted only that

the Treasury Secretary has plans for "reform" of Social Security.

(AP's original headline on the piece: "O'Neill: Further Tax Relief

Coming," 5/21/01.)

Washington Post columnist John O. Fox used O'Neill's "abomination" quote

to shore up his own argument about the U.S.'s "monstrously complicated"

tax code, but ignored the rest of his statements. And the Post's David

Broder made no reference to the Financial Times interview in his June 6

column, which referred to Bush administration plans to "open [Social

Security and Medicare] up to market forces."

Broder did note congenially that "as Treasury Secretary Paul O'Neill...reminded me the other day, what makes the task

so difficult is the need to educate people about the current system, before they can be

persuaded that it needs to be changed as the administration proposes."

Indeed, the American people could use "educating" about just what the Bush

administration and its Treasury Secretary propose. But where will they get

it if not from the mainstream news media?

ACTION: Please write to national and local media outlets and ask them why

Paul O'Neill's calls for eliminating corporate taxes and Social Security

were not a major news story.

Some suggested contacts include:

ABC World News Tonight

Anchor and Senior Editor

Peter Jennings

mailto:PeterJennings@abcnews.com

NBC News

DC Bureau Chief & Host, "Meet the Press"

Tim Russert

mailto:mtp@msnbc.com

New York Times

mailto:nytnews@nytimes.com

Toll free comment line: 1-888-NYT-NEWS

Washington Post

Deputy National Editor (Domestic Policy)

Leonard Bernstein

mailto:bernsteinl@washpost.com

Los Angeles Times

DC Bureau Chief

Doyle McManus

mailto:doyle.mcmanus@latimes.com