June 30, 2011 02:22 AM UTC

Cory Gardner Sounds The Retweet

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• by: Colorado Pols

Fox News and the rightiesphere swung into action today at an apparent live one:

The chief economic culprit of President Obama’s Wednesday press conference was undoubtedly “corporate jets.” He mentioned them on at least six occasions, each time offering their owners as an example of a group that should be paying more in taxes.

“I think it’s only fair to ask an oil company or a corporate jet owner that has done so well,” the president stated at one point, “to give up that tax break that no other business enjoys.”

But the corporate jet tax break to which Obama was referring – called “accelerated depreciation,” and a popular Democratic foil of late – was created by his own stimulus package…

Within a few minutes of President Barack Obama’s mention of this tax break as something he wanted eliminated during budget negotiations today, the Heritage Foundation had a story up titled, “Obama Blasts Private Jet Tax Breaks Created by His Own Stimulus,” and the dudgeon-fest was on. Joined in by Colorado’s own Rep. Cory Gardner via Twitter:

So, there are a few problems with this–first of all, sacrificing a provision of the much-reviled “failed stimulus bill” for the purpose of deficit reduction should be a good thing, right? Of course, if you admit that this (or any) particular provision in the stimulus bill was maybe okay–remember that Republicans have pledged to fight any eliminations of tax breaks–then you have to admit that a few others probably were okay too, and then you have to concede that a large percentage of the stimulus actually consisted of tax breaks like this one and then…oops! You can’t really attack Obama with it anymore, can you?

So that’s one problem. The second problem, reports Matthew Yglesias over at ThinkProgress, is that the hated commie American Recovery and Reinvestment Act (ARRA) didn’t create this tax break.

The truth is that, much as you would expect, the White House negotiating team isn’t nearly that stupid. The source of the confusion is that congress passed a “bonus depreciation” law in 2008 as an economic stimulus measure, and ARRA continued it. This depreciation is a broad (albeit temporary) provision that includes to a wide range of capital goods including both commercial and corporate aircraft. By contrast, the tax break at issue in the negotiations is a 1987 provision of the tax code that allows corporate jets to be depreciated over a five-year period rather than the seven-year period required for commercial aviation. This is not something Barack Obama created, not something Barack Obama has ever supported, and not anything that has anything to do with the stimulus bill. It is, instead, a small but real subsidy that distorts the economy at the margin by encouraging large firms to invest in corporate jets rather than paying for commercial airfare.

We may be in for a dozen rounds of this kind of myth-making. The White House has put on the table the idea that we should raise tax revenue without necessarily raising tax rates. That means closing loopholes. But congressional Republicans say they’re opposed to any increases in tax revenue. Now everyone knows that the tax code contains lots of unjustifiable loopholes, so the White House can gain a strong rhetorical upper hand by highlighting specific loopholes. Since the GOP has committed itself to defending each and every loophole no matter how absurd they’re going to need to engage in a lot of desperate smokescreens like this to avoid engaging directly with the core question.

The third problem: before it’s over, Gardner will be fighting for these very same tax breaks.