American Crossroads' Stimulus Claims Continue To Deceive

October 25, 2010 2:48 pm ET

American Crossroads frequently attacks the Recovery Act and a variety of projects funded by the legislation. In its latest attack on Missouri Senate candidate Robin Carnahan, before criticizing the "failed stimulus" as a whole, Crossroads goes after a grant received by Carnahan's brother, claiming that "his family name helped" him obtain funding for his company. In reality though, the grant that Carnahan's brother's company received was from a non-competitive program that has provided payments to over 1,300 alternative energy companies in lieu of tax credits — tax credits that Carnahan's opponent, Rep. Roy Blunt (R-MO) has supported numerous times in Congress.

American Crossroads: "Continued"

The story continues. Robin Carnahan supported the failed stimulus, her brother voted for it, and her other brother got a lucrative stimulus grant. He said his family name helped. We need to end this story. Robin Carnahan stands with Washington's failed stimulus, with their takeover of our health care, but to them, she's just another vote. This country's going in a new direction. Say no to Robin Carnahan. American Crossroads is responsible for the content of this advertising.

Carnahan's "Family Name" Had Nothing To Do With Stimulus Grant Award

Energy And Treasury Department Officials Say Neither Robin Nor Russ Carnahan Were Involved With Awarding Grants. According to the St. Louis Post-Dispatch: "But officials from the Energy and Treasury departments, who jointly administer the program, said that neither Russ nor Robin Carnahan played a role in the awards." [St. Louis Post-Dispatch, 9/29/10]

Tax Credit Program That Issued The Grant Received By Wind Capital Group Is Not Competitive. From an analysis of a Friends of Roy Blunt ad which accused Carnahan's brother of receiving a stimulus "payoff" for his family's support of President Obama and the Recovery Act by the Kansas City Star: "The ad suggests that Tom Carnahan won the grant because he raised money for Barack Obama in 2008. But the Treasury and Energy departments say the grants weren't competitive; applicants either met the qualifications or didn't. Wind Capital Group, they say, qualified." [Kansas City Star, 9/30/10; emphasis added]

FactCheck.org: "There Is Simply No Evidence Of A Quid Pro Quo." According to the non-partisan FactCheck.org: "But where's the evidence that this support resulted in a 'pay off'? When we asked the Blunt campaign that question, we were directed to an August 2009 article in the Irish Independent. In an e-mail, Blunt campaign spokesman Rich Chrismer claimed the article shows an executive of NTR, the parent company of the Wind Capital Group, 'admitting the 'fortuitous' and 'convenient' timing of their partnership with Carnahan.' However, those words were the reporter's, not the company executive's. There is simply no evidence of a quid pro quo." [FactCheck.org, 10/12/10; emphasis added]

Wind Capital Group Is One Of Over 1,300 Companies That Has Received Grants From The Stimulus Program. According to the U.S. Treasury's most recently updated list of awards, there are 1,301 companies — including Wind Capital Group — that have received Stimulus grants from the 1603 program which awards grant payments in lieu of production tax credits. [USTreas.gov, accessed 10/23/10]

Carnahan's Opponent, Rep. Blunt, Has Voted To Extend The Tax Credits Carnahan's Brother Received "Several Times." The St. Louis Post-Dispatch reported that "Robin Carnahan's opponent in the Senate race, U.S. Rep. Roy Blunt, was a key backer of the financial bailout bill in 2008, one of several measures that reauthorized the tax credit." Additionally, according to the Kansas City Star: "Blunt has voted several times in favor of the grant program." [St. Louis Post-Dispatch, 9/29/10; Kansas City Star, 9/30/10]

The "Failed" Recovery Act Actually Created Millions Of Jobs And Boosted The Economy

The Economy Shed Almost 8 Million Jobs Under Republican Policies Before The Recovery Act Was Passed. According to economist Robert J. Shapiro:

From December 2007 to July 2009 - the last year of the Bush second term and the first six months of the Obama presidency, before his policies could affect the economy - private sector employment crashed from 115,574,000 jobs to 107,778,000 jobs. Employment continued to fall, however, for the next six months, reaching a low of 107,107,000 jobs in December of 2009. So, out of 8,467,000 private sector jobs lost in this dismal cycle, 7,796,000 of those jobs or 92 percent were lost on the Republicans' watch or under the sway of their policies. Some 671,000 additional jobs were lost as the stimulus and other moves by the administration kicked in, but 630,000 jobs then came back in the following six months. The tally, to date: Mr. Obama can be held accountable for the net loss of 41,000 jobs (671,000 - 630,000), while the Republicans should be held responsible for the net losses of 7,796,000 jobs. [Sonecon.com, 8/10/10, emphasis added]

Based on Shapiro's research, the Washington Post's Ezra Klein created the following chart showing net job losses before and after the Recovery Act was enacted:

Klein

[Washington Post8/12/10]

CBO: The Recovery Act Created Jobs, Lowered Unemployment, And Boosted GDP. According to the nonpartisan Congressional Budget Office, through the second quarter of 2010, the American Recovery and Reinvestment Act:

  • Raised the level of real (inflation-adjusted) gross domestic product (GDP) by between 1.7 percent and 4.5 percent,
  • Lowered the unemployment rate by between 0.7 percentage points and 1.8 percentage points,
  • Increased the number of people employed by between 1.4 million and 3.3 million, and
  • Increased the number of full-time-equivalent (FTE) jobs by 2.0 million to 4.8 million compared with what those amounts would have been otherwise.

[CBO, 8/24/10]

Reuters: The Recovery Act May Have "Prevented The Sluggish Economy From Contracting" Between April And June. According to Reuters

The massive U.S. stimulus package put millions of people to work and boosted national output by hundreds of billions of dollars in the second quarter, the nonpartisan Congressional Budget Office said on Tuesday.

CBO's latest estimate indicates that the stimulus effort, which remains a political hot potato ahead of the November congressional elections, may have prevented the sluggish U.S. economy from contracting between April and June.

CBO said President Barack Obama's stimulus boosted real GDP in the quarter by between 1.7 percent and 4.5 percent, adding at least $200 billion in economic activity. [Reuters via ABC News, 8/24/10]

Job Statistics Trend Shows Recovery Act Is Working. Below is a graph prepared by the Speaker's office showing net private sector job gains or losses per month since December 2007.

jobs

[Bureau of Labor Statistics via The Gavel, 10/8/10]

Princeton, Moody's Economists Say "Highly Effective" Government Response To Crisis Saved 8.5 Million Jobs. According to the New York Times: "Like a mantra, officials from both the Bush and Obama administrations have trumpeted how the government's sweeping interventions to prop up the economy since 2008 helped avert a second Depression. Now, two leading economists wielding complex quantitative models say that assertion can be empirically proved. In a new paper, the economists argue that without the Wall Street bailout, the bank stress tests, the emergency lending and asset purchases by the Federal Reserve, and the Obama administration's fiscal stimulus program, the nation's gross domestic product would be about 6.5 percent lower this year. In addition, there would be about 8.5 million fewer jobs, on top of the more than 8 million already lost; and the economy would be experiencing deflation, instead of low inflation. The paper, by Alan S. Blinder, a Princeton professor and former vice chairman of the Fed, and Mark Zandi, chief economist at Moody's Analytics, represents a first stab at comprehensively estimating the effects of the economic policy responses of the last few years. 'While the effectiveness of any individual element certainly can be debated, there is little doubt that in total, the policy response was highly effective,' they write." [New York Times7/27/10, emphasis added]

There Was No "Takeover" Of Health Care

PolitiFact: "Obama's Plan Leaves In Place The Private Health Care System." Analyzing Sen. Tom Coburn's claim that President Obama's health care reform plan amounted to a government takeover of health care, PolitiFact.com wrote:

[H]e's wrong that Obama's plan offers government-run health care.

In fact, Obama's plan leaves in place the private health care system, but seeks to expand it to the uninsured. It increases eligibility for the poor and children to enroll in initiatives like Medicaid and the State Children's Health Insurance Program, and creates pools for individuals to buy their own cheaper insurance. It also outlines strategies to rein in costs for everyone, such as electronic medical records and preventive care.

[...]

That may be Sen. Coburn's opinion on what could happen, but it's definitely not part of Obama's plan. And Coburn was very specific in saying that "under the Obama plan, all the health care in this country is eventually going to be run by the government." That gives the incorrect impression that Obama is promoting a government-run health care system. He's not. We rate Coburn's statement False.

[PolitiFact.com, 3/4/10, emphasis added]

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