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Democratic Disinformation from Charlotte

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Posted on September 5, 2012  , Corrected on September 5, 2012
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CHARLOTTE, N.C. — We heard a number of dubious or misleading claims on the first night of the Democratic National Convention:

  • The keynote speaker and others claimed the Republican presidential nominee, Mitt Romney, would raise taxes on the “middle class.” He has promised he won’t. Democrats base their claim on a study that doesn’t necessarily lead to that conclusion.
  • The keynote speaker, San Antonio Mayor Julian Castro, also said there have been 4.5 million “new jobs” under Obama. The fact is the economy has regained only 4 million of the 4.3 million jobs lost since Obama took office.
  • Castro also insisted Romney and Ryan would “gut” Pell Grants for lower-income college students. Actually, the Ryan budget calls only for “limiting the growth” of spending for the program, and Ryan has said the maximum grant of $5,550 would not be decreased.
  • A Democratic governor said Romney “left his state 47th out of 50 in job growth.” Actually, Massachusetts went from 50th in job creation during Romney’s first year to 28th in his final year.
  • Two advocates of equal-pay legislation said women make 77 cents for every dollar men earn. That’s true on average, but the gap for women doing the same work as men is much less, and not entirely or even mostly the result of job discrimination.
  • A union president accused Romney of seeking “a government bailout” for “his company.” Not really. In fact, Romney negotiated a favorable but routine settlement with bank regulators on behalf of a former company, the one he had left to form his own Bain Capital firm. No taxpayer funds were involved.
  • Multiple speakers repeated a claim that the Ryan/Romney Medicare plan would cost seniors $6,400 a year. That’s a figure that applied to Ryan’s 2011 budget plan, but his current proposal (the one Romney embraces) is far more generous. The Congressional Budget Office says it “may” lead to higher costs for beneficiaries, but it can’t estimate how much.
  • In prepared remarks released to reporters, Rep. James Clyburn engaged in  partisan myth-making with the claim “Democrats created Social Security”  while Republicans “cursed the darkness.” History records strong  bipartisan support in both House and Senate for the measure President  Roosevelt signed in 1935.

Note to Readers

Our  managing editor, Lori Robertson, is on the scene in Charlotte at the convention  center. This story was written with the help of   the    entire staff, based  in Philadelphia and Washington, D.C. We are vetting the   major   speeches at  this convention for  factual accuracy, holding Democrats to the same   standards we applied in last week’s coverage of the Republican convention.

Middle-Class Taxes

The keynote speaker, San Antonio Mayor Julian Castro, repeated a frequent but groundless Democratic talking point, warning that Romney would  raise taxes on the middle class.

Castro was joined in this by other Democrats including former Virginia Gov. Tim Kaine and  Maryland Gov. Martin O’Malley. But they all misrepresented the position  Romney has made clearly and repeatedly — that he would somehow lower taxes on those in the middle class. Their claim rests on a distortion of a nonpartisan group’s findings.

Castro: And now we need to make a choice. It’s a   choice between a country where the middle class pays more, so that   millionaires  can pay less or a country where everybody pays their fair   share.

Kaine: To pay for their plan, they’d slash middle-class tax breaks, raising taxes on the middle class.

O’Malley: Instead of a balanced, achievable plan to  create jobs and reduce the deficit, Mitt Romney says he will cut taxes  for millionaires and raise them for the middle class.

Their comments are based on an Aug. 1 report from the Tax Policy Center that concluded it is simply not mathematically possible for Romney  to lower tax rates across the board — as he has proposed — without  losing revenue, which he has also promised, or shifting the tax burden  to the middle class.

Tax Policy Center, Aug. 1: Our major   conclusion is that a revenue-neutral individual income tax change that   incorporates the features Governor Romney has proposed – including   reducing marginal tax rates substantially, eliminating the individual   alternative minimum tax (AMT) and maintaining all tax breaks for saving   and investment – would provide large tax cuts to high-income  households,  and increase the tax burdens on middle- and/or lower-income  taxpayers.

To see our full analysis of the TPC report, and the Romney campaign’s  push-back against it as “biased,” see our Aug. 3 article, “Romney’s Impossible Tax Promise.”

For his part, Romney has repeatedly insisted he will not raise taxes on the middle class. He reiterated that promise  during his speech accepting the presidential nomination at the Republican National Convention:

Romney, Aug. 30: I will not raise taxes on the middle class.

In a blog post on the TPC analysis, Donald Marron, director of the Tax Policy Center, wrote:  “I don’t interpret this [the Aug. 1 study] as evidence that Governor  Romney wants to increase taxes on the middle class in order to cut taxes  for the rich, as an Obama campaign ad claimed. Instead, I view it as  showing that his plan can’t accomplish all his stated objectives. One  can charitably view his plan as a combination of political signaling and  the opening offer in what would, if he gets elected, become a  negotiation.”

In other words, Romney has over-promised. But that’s no reason to  assume –as Kaine, O’Malley and Castro have — that Romney would choose  the course of breaking a promise not to raise middle-income taxes. He  could choose, for example, to renege on his promise to cut rates or to  keep the amount of revenue neutral rather than violate his promise not  to raise taxes on those in the middle.

There’s also been some dispute about the Tax Policy Center’s findings. Republican economist Martin Feldstein wrote an Aug. 28 piece for the Wall Street Journal‘s opinion pages saying that Romney could lower rates across the board as promised  without losing revenue — if he eliminated most deductions for those  making $100,000 or more.

In a rebuttal, Democratic tax expert Len Burman — a former director of the Tax Policy Center — said “such a plan would make no sense as policy,”  because eliminating deductions for family income above $100,000 would  cause an effective tax rate as high as 62.5 percent on income just  above that level.

Romney has yet to provide details of just how he would manage to  avoid either losing revenues (and thus increasing the deficit) or  shifting the tax burden onto middle-income taxpayers. But as things  stand, he’s promised that neither will happen, and Democrats who accuse  him of proposing a middle-income tax increase are misrepresenting what  he’s said.

Keynoter’s Jobs Spin

Keynote speaker Castro also put a misleading spin on employment data. He claimed “we’ve seen 4.5 million new jobs” under President Obama. In fact, the  nation has regained 4.5 million jobs that had been lost, but employment  is still below where it was when the president took office.

Castro: Four years ago, America stood on  the brink of a depression. Despite incredible odds and united  Republican opposition, our president took action. And now we’ve seen 4.5  million new jobs.

Although he didn’t say so, Castro is referring only to private-sector  jobs — which have fared better than government jobs — and he is using  February 2010 as the starting point,  because that was the low point for  private-sector jobs. There were 106,773,000 jobs then, and the number has been rising ever since. In July, there were 111,317,000  private-sector jobs, according to the Bureau of Labor Statistics. That’s an increase of 4,544,000.

The picture changes dramatically, however, when starting from the  beginning of Obama’s presidency. Between January 2009 and the most  recently reported figures, there has been a net increase of just 332,000  private-sector jobs.

Moreover, if you include all jobs — including the hard-hit government job sector  — there remains a net decrease of 316,000 jobs since the start of Obama’s presidency. Total employment  has gained about 4 million since February 2010, not 4.5 million. It’s  all in how you slice the data.

Pell Grant Piffle

Castro also went too far in saying the Republican ticket “guts Pell    Grants.” The Ryan budget plan would limit the growth, but maintain the    maximum award of $5,550.

Castro: It’s a choice between a nation    that slashes funding for our schools and guts Pell Grants — or a nation    that invests more in education.

Ryan has called for changes in the Pell Grant program. His fiscal year 2013 budget proposal, known as “Path to Prosperity,”  says that Obama’s budget “pushes Pell Grant spending toward  unsustainable rates.” Ryan’s budget plan proposes “limiting the growth  of financial aid   and focusing it on low-income students who need it  the most.”

He does not, however, set specific funding levels for the program, so    we don’t know — and neither does Castro — how much Ryan would limit   the  program’s growth. However, Ryan said in    April that his plan “maintains the maximum Pell award of $5,550,” so    for those who do receive the grants, they will continue to get the  same level   as this year.

Castro could have said that Ryan’s plan would result in fewer    students receiving Pell Grants, since the Wisconsin Republican does want    to tighten eligibility requirements and limit the growth of the    program. But Castro went too far in saying that the Republican plan    “guts Pell Grants.”

Massachusetts 47th? Or 28th?

Illinois Gov. Pat Quinn went on the offensive, saying Romney had   failed to deliver on campaign promises he made while running to become   governor of Massachusetts. But some of Quinn’s talking points were a   stretch.

Quinn: Mitt Romney promised   Massachusetts three things: more jobs, less debt and smaller government.   Then he left his state 47th out of 50 in job growth, added $2.6  billion  in debt and on his watch, government jobs grew six times faster  than  private-sector jobs. What does Romney promise today? More jobs,  less  debt and smaller government. But he didn’t do it then, and he  won’t do  it now.

We’ve covered some similar claims before. Let’s start with the claim that Romney “left his state 47th out of 50 in job growth.” That’s a slightly different twist on a recurring Democratic attack line. It’s true that over Romney’s entire four years   as governor, the state ranked 47th out of 50 states in percentage of  job  growth. But that’s a four-year, cumulative number. The state’s  ranking  actually improved while Romney was in office.

In the 12 months before Romney took office, the state ranked 50th in   job creation, and by his final year, the state ranked 28th. Quinn would   have been more accurate to say Romney “left his state” in 28th place,   not 47th.

Quinn also made the misleading claim that Romney “added $2.6 billion   in debt.” That’s a reference to long-term bond debt, used for capital   improvements, such as paving roads, building bridges and repairing   public college buildings and courthouses.

To be sure, long-term debt increased by $2.7 billion during Romney’s   tenure. But that’s nothing out of the ordinary. It increased by $4   billion in the four years before Romney took office. State debt rose   under Romney, but more slowly than before.

Last, Quinn said that under Romney, “government jobs grew six times   faster than private-sector jobs.” Not exactly. Private-sector jobs in   Massachusetts climbed by a modest 39,500, a little less than a 1.5   percent jump. Meanwhile state government jobs increased by 3,100 jobs, a   2.8 percent increase (all government jobs, including local, state and   federal, increased by 1,300 jobs). That’s a larger percentage increase   for government jobs than private-sector ones, but a far smaller number   of jobs.

The 77-Cent Exaggeration

Making a pitch for “equal pay for equal work,” Rep. Rosa DeLauro of  Connecticut said “America’s women still make just 77 cents for every  dollar men earn.” And the equal-pay crusader Lilly Ledbetter used the same figure and added: “[W]hen we lose 23 cents every hour, every day, every paycheck, every job, over the entire lives, what we lose cannot be measured in dollars.”

But that oft-cited 77-cent statistic exaggerates the actual  gap between women and men doing the same work.

As we noted back in June,  the most recent Census figures show that in 2010, “the earnings of  women who worked full time,  year-round were 77 percent of that for men  working full time,  year-round.” But that’s the median (midpoint) for  all women in all jobs, not for  women doing “the same work” or even  necessarily working the same number  of hours.

The actual gap for doing the same work varies by occupation but tends to be much less. We cited a study by the Institute for Women’s Policy Research that found, for example, that female registered nurses made nearly 96  percent of male nurses, female elementary and middle school  teachers  made 91 percent of what their male counterparts earned, secondary school  teachers made 94 percent, and  police officers made 99 percent.

A senior program analyst wrote recently in the Department of Labor’s official blog:  “Economists generally attribute about 40% of the pay gap to   discrimination – making about 60% explained by differences between   workers or their jobs.” As we noted at the time, women tend to work  fewer overtime  hours, tend to choose jobs that offer  more “family  friendly” fringe benefits  in lieu of higher pay, and sometimes  leave  the workforce for years to rear  children, for example.

Bain ‘Bailout’ Baloney

A union president claimed that Romney “asked for a government bailout” for his troubled company. That’s not what happened.

First of all, it wasn’t Romney’s company that was troubled; it was  the consulting firm he had left — Bain & Co. — in order to form Bain  Capital. And while Romney did negotiate a favorable debt settlement  with banking regulators for Bain & Co’s partners, they did not  receive taxpayer dollars.

Mary Kay Henry, international president of the Service Employees International Union, made the claim.

Henry: We just learned that when his company found itself in trouble, Mitt Romney asked for a government bailout.

Our fact-checking colleagues at the Washington Post and ABC News vetted similar claims made by Democrats.

Based on their reporting, here’s what happened:

Romney had left Bain & Co. in 1984 to form the spin-off private equity firm Bain  Capital. But Romney came back in the early 1990s when Bain & Co. was  on the brink of bankruptcy. The company’s founders — Romney wasn’t one  of them — had taken $200 million of borrowed money out of the firm for themselves, which led to the firm’s financial problems.

The company owed $38 million to a failed bank, which had been taken over by the Federal Deposit Insurance Corporation, an independent federal agency that insures bank deposits. Romney negotiated with the FDIC a reduction of $10 million in debt, and the FDIC forgave $4 million in interest.

The agreement didn’t amount to a loss for taxpayers. The FDIC is funded by bank insurance premiums and treasury security investments — not congressional appropriations.

In fact, as the Post points out, these kinds of agreements are typical and recover more of the outstanding loan. The FDIC’s own handbook said that restructuring a loan is more productive than spending money on litigation to recover the money.

More Medicare Malarkey

We once again heard misrepresentations of the Medicare plan that Romney and Paul Ryan have proposed. Health and Human Services Secretary  Kathleen Sebelius and labor leader Mary Kay Henry both said the plan  would cost seniors $6,400, but that’s a reference to an outdated Ryan  plan, not the more generous one he, and Romney, now back.

Sebelius also claimed that Medicare was “missing” from the  “Romney-Ryan plan.” But that’s wrong. The plan keeps traditional  Medicare for current seniors, and as an option for younger workers.

California Rep. Xavier Becerra’s prepared remarks also said that Romney was telling   “older Americans after a lifetime  of hard work that you’re going to pull   the rug out from under them and  turn Medicare into a voucher system.”   But for “older Americans,”  nothing would change under the Romney and   Ryan plan. In fact, anyone  now 55 or older would stay in the current   Medicare system for the rest  of their lives — and younger workers could   still choose traditional  Medicare from among a menu of competing  private  insurance plans  subsidized by federal dollars. Becerra was scheduled to speak on the  first night, but did not.

Several times this year,    we have swatted down similar claims from Democrats and the Obama    campaign about the Medicare plan Ryan proposed as part of his “Path to Prosperity” budget and Romney has embraced. At the convention, Sebelius said:

Sebelius: What’s missing from the    Romney-Ryan plan for Medicare is Medicare. Instead of the Medicare    guarantee, Republicans would give seniors a voucher that limits what is    covered, costing seniors as much as $6,400 more a year.

Henry, the international president of the Service Employees    International Union, said the plan that “would cost the average senior    $6,400 a year out of their own pocket.” Both are referring to Ryan’s  old   plan.

It’s true that a Congressional Budget Office analysis indicated that a 65-year-old in 2022 could pay about $6,400 more per    year under the plan Ryan proposed in 2011. Ryan’s latest plan is more    generous in terms of the subsidies and choices it provides to seniors.

Ryan’s plan would create a Medicare exchange for new Medicare    beneficiaries starting in 2023. They would choose from private plans or    traditional Medicare and buy plans with the help of government    subsidies. The old Ryan plan tied the growth of those subsidies to the    rate of inflation — but health care costs have risen faster than that.    The new plan ties the subsidies to the cost of the second-cheapest    health care policy on the exchange. And if that policy grows faster than    gross domestic product plus 0.5 percentage points, Congress would be    required to do something to lower costs.

On the latest Ryan plan, CBO did say that “beneficiaries might face higher costs,” but added that there was    plenty of uncertainty. There wasn’t a detailed analysis and no mention    of Sebelius’ and Henry’s $6,400 claim.

The comment in Becerra’s prepared remarks about “older Americans,”  however, is misleading   whether it pertains to Ryan’s 2011 or 2012  plan. He claimed older   Americans would be put in a “voucher” system.  But, as we said, anyone 55   or older would stay in the traditional  Medicare system, under either   Ryan proposal.

Becerra: And, Governor Romney, you    should know it’s not right to tell older Americans after a lifetime of    hard work that you’re going to pull the rug out from under them and  turn   Medicare into a voucher system — Couponcare!

We should add that there are actually no vouchers or coupons    involved. Under Ryan’s plan the federal government would pay insurance    companies directly, just as it now pays for most of the cost of health    insurance for millions of federal workers and retirees and their    families, and just as the government will pay for subsidized policies    for lower-income workers under Obama’s Affordable Care Act if it is    allowed to take full effect in 2014.

Sebelius’ comment that Medicare is “missing” from the plan is also    false. Ryan’s latest plan would keep traditional Medicare as an option    even for younger Americans who won’t turn 65 until 2023.

Social Security Mythology

Rep. James Clyburn’s prepared remarks, which were not delivered  because of a scheduling change, exaggerated in claiming that “Democrats  created Social Security” without Republican support in 1935. The fact  is, despite some early Republican opposition, Congress overwhelmingly  approved the proposal with strong bipartisan support. And President  Franklin D. Roosevelt signed the bill into law within seven months of  its introduction — in stark contrast to the protracted partisan battle  over Obama’s health care law.

Echoing John F. Kennedy’s 1960 acceptance speech — in which JFK said,    “We are not here to curse the darkness; we are here to light a  candle” — Clyburn’s prepared remarks said:

Clyburn: When too many of our senior    citizens were living their golden years in the darkness of economic    insecurity, Franklin Roosevelt and Democrats created Social Security,    lighting a candle while Republicans cursed the darkness.

The historical comparison, however, does not hold up.

The Social Security Act of 1935 was a result of the Committee on Economic Security,    a Cabinet-level committee created by President Franklin D. Roosevelt   on  June 29, 1934. On Jan. 17, 1935, two days after the committee  issued   its final report, Roosevelt proposed the “Financial Security  Act of   1935,” and it was introduced in Congress the same day.

For sure, there was opposition to the legislation.

Sen. Daniel Hastings, a Delaware Republican, warned that it would “end the progress of a great country,” as the New York Times reported. But Hastings was in the minority, even within his own party, when it    came to voting on the bill — which was renamed the “Social Security Act    of 1935″ in committee.

The Social Security Administration website shows that the Social Security Act of 1935 passed with bipartisan support in    both chambers — 372-33 in the House and 77-6 in the Senate — in April    and June of 1935, respectively.

In the House, 81 Republicans voted for it, and an equal number of    Republicans and Democrats – just 15 from each party – voted against it.    In the Senate, 16 Republicans voted for it, and only five against,    including Hastings.

Both houses gave final approval to the bill by voice vote on Aug. 8, 1935. Roosevelt signed the bill into law Aug. 14, 1935 — just seven months after it was introduced.

Correction, Sept. 5: The Democratic National Committee released  prepared remarks for Reps. James Clyburn and Xavier Becerra, but neither  of them spoke on Sept. 4, as scheduled. This story has been corrected to reflect the scheduling change.

– Lori Robertson, with Eugene Kiely, Rob Farley, Ben Finley and Brooks Jackson

Entry #55

Comments

1.
Comment by bobbya - September 6, 2012, 10:11 am
Soooo!
Where's the disinformation?
2.
rdgrnrComment by rdgrnr - September 6, 2012, 3:07 pm
Sorry, booby.
You're just gonna have to read it.
You're gettin' like your buddy dorkio.

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