Fact Checking The Sunday Shows - September 5, 2010

Fox News Sunday

CLAIM: Sen. John McCain Falsely Implied That President Obama Is Having A "Death Bed Conversion" To Cutting Taxes For Small Businesses

CHRIS WALLACE (host): Senator, President Obama is set to announce a new economic plan this week that will reportedly center on tax cuts for business to boost hiring and investment. It sounds like something straight out of the Republican playbook. What's your reaction?

SEN. JOHN McCAIN (R-AZ): Well my reaction is we always like to see death bed conversions, but the fact is if we'd have done this kind of thing nearly a couple years ago, we'd be in a lot better shape. Look, they're just flailing around.

FACT: Democrats Have Been Trying To Pass Small Business Tax Relief Bill All Summer, But Republicans Are Filibustering It

House Passed Small Business Aid Bill In Mid-June On Party Lines. According to Reuters: "The U.S. House of Representatives on Thursday approved a small business lending program sought by President Barack Obama to boost economic growth and encourage job creation. The House voted 241-182, mostly along party lines, for a bill which would authorize a $30 billion fund the Treasury Department would use to provide capital to small community banks, allowing increased lending to small businesses...[T]he $30 billion fund could be leveraged into as much as $300 billion in new credit to small businesses. The legislation is being combined with another bill earlier passed by the House that would provide $3.5 billion in small business tax breaks before it is sent over to the Senate for a vote." [Reuters, 6/17/10, emphasis added]

• Senate Republicans Filibustered Bill Prior To August Recess. According to Bloomberg: "Senate Republicans blocked a measure that would cut taxes and ease credit for small businesses, saying they objected that Democrats refused to consider their amendments to extend tax breaks and cap federal spending. The Senate voted 58-42 today to end debate on the bill, falling short of the 60 votes required to consider the legislation for passage." [Bloomberg, 7/29/10]

• USA Today: Small Businesses "Are In A Holding Pattern" Waiting For The Senate To Pass The Bill. According to USA Today: "Small businesses have put hiring, supply buying and real estate expansion on hold as they wait out the vote on a small-business-aid bill that stalled in the Senate earlier this summer. The much-debated legislation offers tax breaks and waived loan fees. But it also comes with more divisive components, such as a $30 billion fund that would help community banks give loans to small businesses. Opponents say the fund would be a mini version of the often-criticized TARP large-bank bailout program. Many small businesses had hoped the legislation would pass the Senate by the end of July. With two weeks left until Congress reconvenes, those firms are in a holding pattern." [USA Today, 8/29/10]

FACT: The American Recovery And Reinvestment Act Included Roughly $288 Billion In Tax Relief For Families And Businesses

PolitiFact: "Nearly A Third" Of Recovery Act Is Tax Breaks. According to PolitiFact.com: "Nearly a third of the cost of the stimulus, $288 billion, comes via tax breaks to individuals and businesses. The tax cuts include a refundable credit of up to $400 per individual and $800 for married couples; a temporary increase of the earned income tax credit for disadvantaged families; and an extension of a program that allows businesses to recover the costs of capital expenditures faster than usual. The tax cuts aren't so much spending as money the government won't get - so it can stay in the economy. Of that $288 billion, the stimulus has resulted in $119 billion worth of tax breaks so far." [PolitiFact.com, 2/17/10]

• Republicans Filibustered The Recovery Act. According to the New York Times: "Senate Democrats on Monday advanced the $838 billion economic stimulus bill, clearing a major procedural hurdle by a razor thin margin with the help of just three Republicans. A vote on final passage of the bill is expected on Tuesday. The Senate vote, by 61 to 36, to close debate on the stimulus, symbolized the partisanship that still grips Congress despitePresident Obama's call for new cooperation. It also highlighted the rising power of the centrist Republicans who cast the critical votes. Under Senate rules, it takes 60 votes to invoke cloture and usher a bill to a vote." [New York Times, 2/9/09]

FACT: The HIRE Act Of 2010 Included $13 Billion In Tax Credits For Businesses

As Of July, Businesses Had Qualified For $8.5 Billion In Tax Relief Under The HIRE Act. According to CNNMoney.com: "Businesses have hired an estimated 4.5 million Americans who have been jobless for at least eight weeks, making these firms eligible for approximately $8.5 billion in tax credits, according to a Treasury report released Monday. The tax credits are part of the $13 billion Hiring Incentives to Restore Employment (HIRE) Act, which Congress passed in March. Under the act, employers who hire workers who have been jobless for at least 60 days are exempt from the 6.2% payroll tax charged per worker -- for the rest year. In addition, companies can claim a tax credit of up to $1,000 for each employee who stays at least a year." [Money.CNN.com, 7/12/10, emphasis added]

• GOP Filibustered Jobs Bill That Included Payroll Tax Relief. According to USA Today: "A bipartisan jobs bill cleared a GOP filibuster on Monday with critical momentum provided by the Senate's newest Republican, Scott Brown of Massachusetts... The bill featured four provisions that enjoyed bipartisan support, including a measure exempting businesses hiring the unemployed from Social Security payroll taxes through December and giving them another $1,000 credit if new workers stay on the job a full year. Although employers seldom make hiring decisions based on tax breaks, economist Mark Zandi says the bill could potentially create 250,000 private-sector jobs." [USA Today, 2/23/10]

CLAIM: Sen. McCain Falsely Claimed Democrats' "Economic Policies Have Failed"

SEN. JOHN McCAIN (R-AZ): The point is that the Obama, uh, Keynesian, uh, on steroids has not worked. Uh, the economic policies have failed.

CLAIM: Sen. Lindsey Graham Suggested The Recovery Act Caused 2.5 Million Job Losses

SEN. LINDSEY GRAHAM (R-SC): If you increase taxes now at any level, it is going to make it harder to create jobs, and we've lost 2.5 million jobs since the stimulus package passed. [Meet the Press, 9/5/10]

FACT: Since The Recovery Act Was Enacted And Began To Take Effect, The Economy Has Added Millions Of Jobs

The Economy Shed Almost 8 Million Jobs Under Republican Policies Before The Recovery Act Took Effect.  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:

[Washington Post, 8/12/10]

CBO: The Recovery Act Raised Employment By As Much As 3.3 Million. 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] 

FACT: Expert Consensus Shows Policy Response To Economic Crisis Saved Millions Of Jobs And Turned The Economy Around

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]

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 Times, 7/27/10, emphasis added]

CLAIM: Sen. McCain Falsely Claimed That The Affordable Care Act Cuts $500 Billion From Medicare

SEN. JOHN McCAIN (R-AZ): ...by the way, after Obamacare, they cut Medicare by half a trillion dollars and also are doing away with Medicare Advantage...

FACT: Health Care Reform Doesn't Cut Medicare — It Strengthens The Program

FactCheck.org: "None Of The 'Savings' Or 'Cuts' (Whichever You Prefer) Come From Reducing Current Or Future Benefit Levels For Seniors." According to FactCheck.org, "The House bill would trim projected increases in payments for hospitals, insurance companies, pharmaceutical companies and others, including home health care providers and suppliers of motor-driven wheelchairs. But it also proposes what CBO estimates is a $245 billion increase in spending for doctors, by canceling a scheduled 21 percent cut in physician payments. None of the 'savings' or 'cuts' (whichever you prefer) come from reducing current or future benefit levels for seniors." [FactCheck.org, accessed 9/9/09]

Health Care Reform "Will Keep Paying Medical Bills For Seniors."  According to PoliFact.com: "The government-run Medicare program will keep paying medical bills for seniors, but it will begin implementing cost controls on health care providers, mostly through penalties and incentives. The legislation would reduce payments for hospital-acquired infections or preventable hospital admissions. For Medicare Advantage, the federal government intends to reduce extra payments, taking away subsidies to private insurance companies. Insurers will likely cut benefits in order to not lose profits. The bill does not address the 'doctor's fix,' an expected proposal that Congress usually passes to prevent doctors' Medicare payments from severe cuts." [PoliFact.com, 3/18/10; emphasis in original]

CBO: Cost Changes To Medicare Made From Savings. According to the CBO: "Changes to the Medicare program and changes to Medicaid and CHIP other than those associated directly with expanded insurance coverage:  Savings from those provisions are estimated to total $93 billion in 2019, and CBO projects that, in combination, they will increase by 10 percent to 15 percent per year in the next decade." [CBO.gov, 10/7/09]

Changes To Medicare Advantage Come With Extra Benefits For All Medicare Enrollees.  FactCheck.org reported: "The CBO has estimated that the move would change the value of the extra benefits Medicare Advantage participants get, but they would not receive fewer benefits than the rest of seniors who aren't on the Advantage plans. The bill does add some extras for Medicare beneficiaries, eliminating copays and deductibles for preventive services, for example." [FactCheck.org, 12/2/09, emphasis added]

Health Care Reform Fills The "Doughnut Hole."  According to the Kaiser Family Foundation: "In 2010, Part D enrollees with any spending in the coverage gap will receive a $250 rebate. Beginning in 2011, enrollees with spending in the coverage gap will receive a 50 percent discount on brand-name drugs, provided by the pharmaceutical industry. The law phases in Medicare coverage in the gap for generic drugs beginning in 2011, and for brand-name drugs beginning in 2013. By 2020, Part D enrollees will be responsible for 25 percent of the cost of both brands and generics in the gap, down from 100 percent in 2010." [Kaiser Family Foundation, accessed 8/25/10]

Click HERE for details on the trillions of dollars Republicans have voted to cut from Medicare.

Meet the Press

CLAIM: Sen. Lindsey Graham Falsely Claimed The Affordable Care Act Will Create A "Government Monopoly" On Health Insurance

SEN. LINDSEY GRAHAM (R-SC): It's going to lead to a government monopoly on health care and bend the cost curve up and not down...

FACT: There Is No Government Takeover Of Health Care

PolitiFact: Republicans Are "Wrong That Obama's Plan Offers Government-Run Health Care." 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]

CLAIM: Sen. Lindsey Graham Falsely Claimed The Affordable Care Act Will Increase Health Care Costs

SEN. LINDSEY GRAHAM (R-SC): It's going to lead to a government monopoly on health care and bend the cost curve up and not down...

FACT: The Affordable Care Act Will Control Health Care Costs While Expanding Coverage To Millions Of Uninsured Americans

PolitiFact: "For Most People, Premiums Would Stay About The Same, Or Slightly Decrease." According to PolitiFact.com: "The CBO reported that, for most people, premiums would stay about the same, or slightly decrease. This was especially true for people who get their insurance through work. (Health policy wonks call these the large group and small group markets.) People who have to go out and buy insurance on their own (the individual market) would see rates increase by 10 to 13 percent. But more than half of those people -- 57 percent, in fact -- would be eligible for subsidies to help them pay for the insurance. People who get subsidies would see their premiums drop by more than half, according to the CBO. So most people would see their premiums stay the same or potentially drop." [PolitiFact.com, 1/27/10; emphasis added]

Affordable Care Act Insures 34 Million New People With 1% Health Care Spending Increase. According to the Washington Post's Ezra Klein: "First, be clear about what's being estimated. The Congressional Budget Office's estimates look at the deficit. CMS is looking at total national health expenditures. This often confuses people into thinking that there's conflict between the two sets of numbers when there isn't: CBO says that federal spending is going to go up to pay for the coverage expansion, but that savings and revenue will go up by even more, leading to a net reduction in the federal deficit. CMS is looking only at the spending side. And here's what it finds: In 2019, implementation of the Affordable Care Act will reduce the ranks of the uninsured by 34 million people and increase nation health expenditures by 1 percent. One percent... So that's the bottom line of the report: We're covering 34 million people and come 2019, spending is expected to be one percentage point -- and falling - above what it would've been if we'd done nothing." [Washington Post, 4/23/10, emphasis added]

CLAIM: Sen. Lindsey Graham Suggested That Tax Cuts Pay For Themselves

DAVID GREGORY (host): When you talk about extending the Bush tax cuts, yes it's existing tax policy but is there a responsibility for Republicans to say if you want to extend all the cuts, that somehow you have to pay for what the impact will be going forward beyond the expiration date on the Treasury?

SEN. LINDSEY GRAHAM (R-SC): Only if you believed America taxes too little. I think America taxes too much.

FACT: Tax Cuts Do Not Pay For Themselves

Time: "If There's One Thing That Economists Agree On, It's That These Claims Are False." According to Time: "If there's one thing that Republican politicians agree on, it's that slashing taxes brings the government more money... If there's one thing that economists agree on, it's that these claims are false. We're not talking just ivory-tower lefties. Virtually every economics Ph.D. who has worked in a prominent role in the Bush Administration acknowledges that the tax cuts enacted during the past six years have not paid for themselves--and were never intended to. Harvard professor Greg Mankiw, chairman of Bush's Council of Economic Advisers from 2003 to 2005, even devotes a section of his best-selling economics textbook to debunking the claim that tax cuts increase revenues." [Time, 12/6/07, emphasis added]

Architect Of Bush Tax Cuts: Tax Cuts Without Budget Offsets Are Really "Future Taxes." According to Bloomberg: "You won't find a truer believer in the big tax cuts of the George W. Bush era than Glenn Hubbard, the 51-year-old economist who is dean of Columbia Business School. The Republican academic was instrumental in designing the tax cuts, first as a Bush campaign insider and then as the president's first chief economic adviser. The idea behind the cuts, enacted in 2001 and 2003, was to encourage work, savings, and investment, thus stimulating long-term economic growth. Hubbard is especially proud of the 2003 cut in taxes on dividends and capital gains, which he calls 'the most pro- growth tax reform that anybody did since Kennedy.' Now that the Bush tax cuts are up for renewal -- they expire on Dec. 31 unless Congress acts -- Hubbard has a queasy feeling about them, Bloomberg Businessweek reports in its Aug. 8 issue. The cuts, he says, have been undermined by years of deficits. Until the trajectory of spending changes, he says, 'deficits are just future taxes. You're just talking about taxes today vs. taxes tomorrow.'" [Bloomberg.com, 8/5/10, emphasis added]