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Donald Trump is hoodwinking the media with his tax plan

Today, after months of faking that he was going to break with GOP orthodoxy on taxes, Donald Trump proposed a plan to cut income tax rates across the board, a structure that necessarily delivers especially large tax cuts to the highest-income taxpayers.

Yet a surprising number of media outlets reported something close to the opposite. The Financial Times ran a headline touting Trump's "populist" tax message.

Financial Times

And ABC News straightforwardly stated that Trump planned to tax the wealthy when, in fact, his proposal would sharply reduce taxes for the wealthy.

ABC News

So what went wrong? The issue seems to be that rather than reading Trump's policy, some reporters paid too much attention to Trump's rhetoric. Trump's plan would, in fact, slightly raise the rate paid by managers of hedge funds on some of their income (though he would cut taxes for most hedge fund managers overall), and he said during his speech that his plan "is going to cost me a fortune."

But while this is what Trump said, it's pretty clearly not what his plan actually does. A quick analysis by the Center for Tax Justice suggests that about one-third of the financial benefit of Trump's plan would flow to the richest 1 percent.

The mistaken policy analysis around Trump's plan seems to have swiftly led to some bad political analysis as well, with NBC News's Chuck Todd pronouncing that the proposal could have been the basis for constructive budget negotiations with the Obama administration. In fact, Obama's budget policies have been very focused on reducing the deficit by raising taxes on high-income Americans, while Trump's plan does precisely the opposite.

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