04/05/2010 05:12 am ET | Updated May 25, 2011

Reuters Pulls Widely-Drudged, Vastly False Story On 'Backdoor Tax Increases'

On Monday, Reuters ran a story that asserted that the Obama administration's plan to allow the Bush-era tax cuts to expire was going to violate a campaign promise by allowing "backdoor tax increases that will result in a bigger tax bill for middle class families." The White House didn't much care for the story, and complained about it, which resulted in Reuters pulling the story.

But lest this episode be portrayed as a White House pressuring a news organization to withdraw a story they didn't like, it should be pointed out that Reuters did in fact, get the story wrong -- as in: the entire premise of the story was horse manure. As TPM's Christina Bellantoni reports:

The White House pushed these points:

- Our budget explicitly calls for permanently extending the Bush tax cuts for households making less than $250,000.

- Our budget explicitly calls for allowing the top rate on dividends to increase to 20% for households making over $250,000.

- Our budget accounts for the cost of continuing the AMT "Patch". The last administration's budgets ignored these costs, but we explicitly account for them.

- Our budget extends expiring tax provisions through 2011.

The official said the Reuters White House team "worked to quickly remedy the situation and helped get the story completely withdrawn" last night.

The original article included a list of what the author deemed tax increases that included allowing a $250 tax credits for teachers buying supplies to expire, for example.

The White House official pointed TPM to the specific page on the budget proving that wrong.

Faced with evidence of their wrongness, Reuters first withdrew the story, initially promising that a "replacement story [would] run later in the week". Eventually, that was amended to say that no replacement story would be forthcoming, which makes sense, since the big story is that Reuters basically cocked this whole thing up, epically.

Of course, while the White House strenuously objected to the story, at least one person loved it like a tiny, fluffy kitten: Matt Drudge, who placed the "backdoor tax increase" story atop his eponymous Report. Once Reuters withdrew the story, Drudge ran a link under his original link that read "Reuters pulls tax story..." that linked out to Reuters' initial retraction notice. He managed to find a way to keep the original, false story in play, however, by switching his original link to Reuters incorrect story, still running on Yahoo Canada's news site (the story has since been withdrawn from that location, as well).

As for Reuters, as Ryan Tate points out over at Gawker, this is the second time in the recent past that Reuters has had to yank a story, but, in this case, it is "the first actually bad one." Tate is referring to a December story "about a billionaire hedge fund manager who just happens to own a chunk of the newswire".

This recent mistake, however, might never have occurred if the reporter had done something basic like "read the relevant documentation" or "called the White House for comment."

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