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Posted at 06:00 AM ET, 07/05/2011

A well-used but misleading Medicaid statistic

Witnesses at a hearing on Medicaid legislation in Florida last month (Lynne Sladky/AP)
“Cash-strapped states are also feeling the burden of the Medicaid entitlement. The program consumes nearly 22 percent of states’ budgets today, and things are about to get a whole lot worse.”

— Sen. Orrin Hatch (R-Utah), June 23, 2011, at a hearing of the Senate Finance Committee

 “Medicaid is the lion’s share of that spending burden as it now consumes about 22 percent of state budgets now and will consume $4.6 trillion of Washington’s budget over the next ten years.”

— Former Kentucky governor Ernest Lee Fletcher (R), June 23, 2011, at the same hearing

 “Across the country, governors are concerned about the burgeoning cost of Medicaid, which in fiscal 2010 consumed nearly 22 percent of state budgets, according the National Association of State Budget Officers. That’s larger than what states spent on K-12 public schools.”

Washington Post front page article, June 14, 2011


When a statistic is universally tossed around as a certified fact, it’s time to get suspicious.

 Such is the case with this oft-cited statistic that 22 percent of state budgets is being gobbled up by Medicaid, the state-federal program that provides health coverage for the poor and the disabled. Medicaid supposedly is even dwarfing what is spent on educating children and teenagers.

 But note the phrase “state-federal.” There’s billions of dollars in federal money involved, and the “22-percent” statistic obscures that fact. Let’s dig a little deeper into the numbers.


The Facts

 Medicaid was a central part of President Lyndon Johnson’s “Great Society” initiative in the mid-1960s. Each state administers its own Medicaid program, but with federal oversight, federal requirements—and plenty of federal dollars. On average, the federal government provides 57 percent of Medicaid funds.

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By  |  06:00 AM ET, 07/05/2011 |  Permalink  |  Comments ( 0)
Categories:  True but False, Health, Congressional Republicans

Posted at 06:00 AM ET, 07/01/2011

Barbara Boxer’s blatant rewriting of history

(Paul Sakuma/AP)
   “I think we ought to go back to the people and the party that was the only party and the only people to balance the budget in 40 years. I hate to break it to my Republican friends, but that is the Democratic Party. We are the ones who did it. We did it when Bill Clinton came into office. We did it after hard work. We did it after painful cuts. We did it with smart investments.”

— Sen. Barbara Boxer (D-Calif.), June 29, 2011

Each party in Washington seems to have their own narrative. Sen. Boxer’s comment above, from a long floor speech Wednesday lambasting Republicans for pushing a balanced budget amendment to the constitution, is a case in point.

 In Boxer’s telling, the budget surplus that emerged in 1998 and continued for four years sprang forth from a critical moment — the passage of Bill Clinton’s 1993 deficit-reduction bill. For those who don’t remember, it was a cliffhanger vote in both houses of Congress, with not a single Republican lawmaker supporting it.

 “Lucky for us, a lot of us are still here who made that fateful vote. We didn't have one Republican voting for that budget, and when they came to the floor — I have all the quotes, chapter and verse--they said: This is horrible. It will never balance the budget. This is going to lead to a depression. This is the worst thing,” Boxer recounted.

Boxer added: “But we know what happened. We not only balanced the budget, but we had a surplus. We not only had a surplus, but the debt was going down so fast we thought we would never have to have Treasury bonds again. On top of that, we created 23 million jobs.”

 But is that really what happened? Were Republicans — who controlled the House and essentially the Senate when the budget was in surplus in 1998, 1999, 2000 and 2001 — irrelevant to the process?


The Facts

 President Clinton’s deficit plan certainly was a political and economic gamble.

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By  |  06:00 AM ET, 07/01/2011 |  Permalink  |  Comments ( 0)
Categories:  3 Pinocchios, Congressional Democrats, Economy

Posted at 06:00 AM ET, 06/30/2011

The missing facts in President Obama’s news conference

(Carolyn Kaster/AP)
“The tax cuts I'm proposing we get rid of are tax breaks for millionaires and billionaires, tax breaks for oil companies and hedge fund managers and corporate jet owners.”

— President Obama, June 29, 2011

A feisty President Obama met with reporters Wednesday — a sure sign that the dispute over the debt limit has reached a critical stage.

The president, clearly intending to increase pressure on the GOP, lambasted Republicans for, in his words, refusing to get rid of “tax breaks for millionaires and billionaires” before cutting aid to the less well-off. He also addressed questions on Libya.

Let’s parse some of his answers and explain what he means — and how factual he was.

 “The tax cuts I'm proposing we get rid of are tax breaks for millionaires and billionaires, tax breaks for oil companies and hedge fund managers and corporate jet owner. . . . Before we ask our seniors to pay more for health care, before we cut our children's education, before we sacrifice our commitment to the research and innovation that will help create more jobs in the economy, I think it's only fair to ask an oil company or a corporate jet owner that has done so well to give up that tax break that no other business enjoys.”

The White House and Congress have been looking for ways to cut the deficit over 10 years by $2 trillion to $4 trillion. Republicans want to cut spending, while Democrats have sought ways to increase revenues — a nonstarter for most Republicans.

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By  |  06:00 AM ET, 06/30/2011 |  Permalink  |  Comments ( 0)
Categories:  2 Pinocchios, Barack Obama, Economy, Middle East

Posted at 06:00 AM ET, 06/29/2011

Explaining the debt ceiling debate

(Andrew Harrer/Bloomberg)
“It isn't true that the government would default on its debt because, very simply, the treasury secretary can pay the interest on the debt first and then, from there, we have to just prioritize our spending…. It is scare tactics because, Bob, the interest on the debt isn't any more than 10 percent of what we're taking in. In fact, it's less than that. And so the treasury secretary can very simply pay the interest on the debt first, then we're not in default. ”

— Rep. Michele Bachmann (R-Minn.), June 26, 2011, on CBS’s “Face the Nation”


“If we never raise the debt ceiling again, we're going to pay our bills, we're going to pay Social Security. …We won't default. We'll be going back to budget levels of about eight years ago.”

— Sen. Jim DeMint (R-S.C.), June 26, on CNN’s “State of the Union”


“If Congress fails to increase the debt limit, the government would default on its legal obligations – an event unprecedented in American history. This would cause investors here and around the world to doubt, for the first time, whether the United States will meet its commitments. That would precipitate a self-inflicted financial crisis potentially more severe than the one from which we are now recovering.”

— Treasury Department fact sheet, “Debt Limit: Myth v. Fact”

Confused about the debt-limit debate?

 This is turning into one of those classic Washington showdowns: A political event is being forced by an extremely technical matter that few really understand. The debt limit is really what filmmaker Alfred Hitchcock used to call a “MacGuffin” — a device used to propel the plot forward, even though it may be meaningless.

 Congress instituted the debt limit back in 1917, during World War I, so that it could stop having to approve every single spending request by the Treasury — but still have a measure of control over spending.

 Even under the most conservative budget plans, the United States would have to keep adding to the national debt in order to meet all sorts of current obligations, such as Social Security payments, Medicare and the wars in Iraq and Afghanistan. So the debt limit will have to be raised, one way or the other.

 But lawmakers are using the pending breach of the debt limit, currently estimated to be in early August, to force the administration to accept significant cuts in spending. (Republicans have ruled out raising taxes.)

 That’s their prerogative. In Washington, there is apparently nothing wrong with playing politics with the debt limit. When he was a senator, President Obama famously refused to approve a debt limit increase in 2006 without a plan to reduce the deficit. Now, he calls that  “a political vote.”

 In any case, we have now reached the stage where some lawmakers — see the Bachmann and DeMint quotes above — shrug off the potential consequences of not reaching an agreement in August. But the Treasury Department warns that this event would be “unprecedented” and three credit-rating agencies — Standard & Poor’s, Moody’s and Fitch — have warned the United States could lose its triple-A credit rating if a deal is not reached by August 2.


The Facts

 “Unprecedented” may be a stretch. There are actually three instances when the United States could be seen to have defaulted on its obligations — in 1790, in 1933 and in 1971.

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By  |  06:00 AM ET, 06/29/2011 |  Permalink  |  Comments ( 0)
Categories:  2 Pinocchios, Congressional Republicans, Michele Bachmann, Barack Obama, Economy

Posted at 06:19 AM ET, 06/28/2011

Fact-checking Michele Bachmann’s announcement speech and Sunday interviews

“Of course a person has to be careful with statements that they make. I think that's true. And I think now there will be an opportunity to be able to speak fully on the issues. I look forward to that.”

— Rep. Michele Bachmann, responding to a question about being “a flake” on “Fox News Sunday,” June 26, 2011


Rep. Michele Bachmann (R-Minn.), who on Monday formally announced her candidacy for the GOP presidential nomination, is a terrific public speaker with a long history of playing fast and loose with the facts. (For a list of our recent articles on Bachmann’s statements, click here.)

 Monday’s address, given in Waterloo, Iowa, was mostly a vision statement, with only a few assertions worth double-checking. We will take a look of those — as well as more  dubious statements she made on the Sunday morning news shows in advance of her speech.

Announcement speech, June 27

 “Five decades ago in America, we had less debt than we have today. We had $300 billion or less in debt. A gallon of gasoline was 31 cents and owning a home was part of the American dream. Today, that debt stands at over $14 trillion. A gallon of gas is outrageously expensive and unfortunately, too many millions of Americans know what it is to have a home that's in foreclosure.”

Context matters a lot when you use numbers. In this case, Bachmann creates a false impression by using figures from a half-century ago without adjusting for inflation or other factors. 

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By  |  06:19 AM ET, 06/28/2011 |  Permalink  |  Comments ( 0)
Categories:  2 Pinocchios, Michele Bachmann, Candidate Watch

Posted at 06:00 AM ET, 06/27/2011

Has the long-term fiscal challenge not gotten worse in the past two years?

(Mark Wilson/GETTY IMAGES)
"On the budget, we have known about the long-run fiscal challenge facing the country for 40-plus years, and that problem has not gotten materially worse in the last two years. That problem is rooted in the aging of the population, the acceleration of health care costs, and I would argue, some of the tax policy choices made in the 2000's."

--Austan Goolsbee, chairman of the Council of Economic Advisers, June 10, 2011


On the face of it, this comment that the nation’s fiscal challenge “has not gotten materially worse in the past two years” appears strange--and certainly provocative.

 Indeed, when Austan Goolsbee, one of President Obama’s chief economic aides, made this assertion this month, one reporter covering his speech felt compelled to note: “The national debt has increased from $10.4 trillion to $14.3 trillion since Obama took office in 2009.”

 Still, Goolsbee’s comment raises an interesting question. As negotiations to reach a budget deal heat up before the United States breaches its debt limit, are lawmakers and administration officials too focused on the recent run-up in the debt?  There have been some proposals this year to deal with long-term health costs—notably the controversial House Republican plan for Medicare—but overall the debate has revolved around current spending.

 A White House official, speaking on condition of anonymity, defended Goolsbee’s comment as not controversial at all.

 “The baby boom's implication for future imbalance has been documented for decades and has gotten two years closer but the demographics haven't changed,” the official said. “The deficits caused by the business cycle over the last two years and the added debt only impacts our long run fiscal situation by, essentially, the interest we pay on the additional debt. The $10 to $14 trillion is not the long run fiscal challenge.”

 So we decided to test the question of whether the fiscal challenge has gotten “materially worse” under President Obama. We will try not to get too wonky.


The Facts

 Both left-leaning and right-leaning economists agreed that the best source for the answer to this question are regular studies on the fiscal challenge done largely by Alan Auerbach, an economics professor at University of California at Berkeley, and William Gale, an expert on federal economic policy at the Brookings Institution.  

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By  |  06:00 AM ET, 06/27/2011 |  Permalink  |  Comments ( 0)
Categories:  Barack Obama, Economy, Verdict Pending

Posted at 06:00 AM ET, 06/24/2011

Are Medicare patients ‘going to die’ under Obama’s health law?

(By Linda Davidson/The Washington Post)
“Democrats like to picture us as pushing grandmother over the cliff or throwing someone under the bus. In either one of those scenarios, at least the senior has a chance to survive. But under this IPAB [Independent Payment Advisory Board] we described that the Democrats put in ‘Obamacare,’ where a bunch of bureaucrats decide whether you get care, such as continuing on dialysis or cancer chemotherapy, I guarantee you when you withdraw that the patient is going to die. It’s rationing."

— Rep. Phil Gingrey (R-Ga.), June 22, 2011

The body count in the war between Democrats and Republicans over Medicare continues to mount.

First, Health and Human Service Secretary Kathleen Sebilius said that cancer patients would “die sooner” under the House Republican Medicare proposal. (She earned Three Pinocchios for that statement.) Now, Rep. Phil Gingrey has charged that a provision in the Obama health-care law — the creation of an Independent Payment Advisory Board — will lead to the death of people on dialysis or cancer chemotherapy because of “rationing” by “bureaucrats.” 

Who knew that politicians on each side were so determined to let people die? (We embed the notorious “Granny off the cliff” ad at the end of this column.) Turning the tables on Democrats who claim the GOP plan would “kill Medicare,” Gingrey said that by supporting the IPAB, “President Obama has already ended Medicare as we know it.”

Rhetoric aside, Gingrey’s comment seems like an opportune time to try to examine this mysterious entity and what it is intended to do. Many senior Republican lawmakers have complained about it, and we imagine it will be featured in future presidential debates.

The Facts

Beginning in 2014, the 15-member IPAB (made up of experts subject to Senate confirmation) is designed to help reduce the rate of growth in Medicare spending if it exceeds a certain target rate. The board would make recommendations to reduce costs.

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By  |  06:00 AM ET, 06/24/2011 |  Permalink  |  Comments ( 0)
Categories:  3 Pinocchios, Congressional Republicans, Health

Posted at 06:00 AM ET, 06/23/2011

Newt Gingrich’s video attack on the Federal Reserve

(Justin Sullivan/Getty Images)
“When hundreds of billions of dollars of our money is being spent, it can’t be in secret and I think the Federal Reserve has become so important to our economy and it affects our lives in so many ways that we the American people have the right to know how our money is being spent. …We should repeal the Dodd-Frank bill…This economy is going to stay mired in a bad economy until we bring the Fed under control and we repeal the Dodd-Frank bill ”

— Former House speaker Newt Gingrich (R-Ga.), in a new campaign video titled “Who Got the Money?”


 With exquisite timing, former House speaker Newt Gingrich released a new presidential campaign video titled “Who Got the Money?” on the same day reports surfaced that Gingrich had a second line of credit at Tiffany and Co., this one valued at $500,000 to $1 million. 

 The two-minute video (embedded at the end of the column) is a somewhat confusing attack on the Federal Reserve, which appears to be part of an attempt by Gingrich to appeal to supporters of Rep. Ron Paul (R-Tex.), a fierce critic of the Fed.

 In the video, Gingrich also calls for the repeal of the Dodd-Frank law, the financial regulatory overhaul that was signed into law less than a year ago. In the video, Gingrich never quite makes clear the reasons for repeal, besides an animus for the Democratic lawmakers whose names adorn the bill, Sen. Chris Dodd (Conn.) and Rep. Barney Frank (Mass.)

The video, which closes with an appeal to demand an audit of the Fed, leaves the impression that the Fed has not disclosed what it did to shore up financial institutions during the 2007-2008 financial crisis. Is that the case?


The Facts

 On the Federal Reserve website, there’s a section titled “Usage of Federal Reserve Credit and Liquidity Facilities.” As the website explains, the page provides “detailed information about the liquidity and credit programs and other monetary policy tools that the Federal Reserve used to respond to the financial crisis that emerged in the summer of 2007.”

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By  |  06:00 AM ET, 06/23/2011 |  Permalink  |  Comments ( 0)
Categories:  2 Pinocchios, Candidate Watch, Newt Gingrich, Economy

Posted at 12:01 AM ET, 06/23/2011

Obama’s ‘mission accomplished’ speech on Afghanistan?

(Associated Press)
“Along with our surge, our allies also increased their commitments, which helped stabilize more of the country. Afghan security forces have grown by over 100,000 troops, and in some provinces and municipalities we have already begun to transition responsibility for security to the Afghan people. In the face of violence and intimidation, Afghans are fighting and dying for their country, establishing local police forces, opening markets and schools, creating new opportunities for women and girls, and trying to turn the page on decades of war.”

— President Obama, June 22, 2011

President Obama’s speech Wednesday night announcing that over the next 15 months he would remove the “surge” troops from Afghanistan had an air of inevitability about it. When the president announced the surge in December 2009, he said that they would begin coming home in July 2011. He added a caveat — “we will execute this transition responsibly, taking into account conditions on the ground” — but the message was clear that some troops would be coming home. The only question was how many.

The decision to remove 10,000 at first leaves commanders significant flexibility this summer, allowing them to keep as many combat troops as possible and focus on rotating out support personnel. The pledge to remove another 23,000 troops by next September — in time for the presidential election — may be more difficult, since many troops apparently will be packing up to go home when they could instead be in the thick of the summer fighting season. The military experts will have a field day with these questions.

We were curious how the president justified having achieved the right conditions on the ground — have “met our goals,” as he put it. The speech actually provided little insight into his thought process and did not provide a decision tree. Instead he asserted “al-Qaeda is under more pressure than at any time since 9/11” and he cited the killing of Osama bin Laden and information obtained from bin Laden’s lair.

Then, he made the statement above. The statistics are a bit unclear, but Obama’s claims appeared to be cut from the same rhetoric cloth that former President George W. Bush used to claim progress in Iraq.

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By  |  12:01 AM ET, 06/23/2011 |  Permalink  |  Comments ( 0)
Categories:  Barack Obama, issue context, War on Terror

Posted at 06:00 AM ET, 06/22/2011

Fact Checking Huntsman’s fact-free announcement speech

(Spencer Platt/Getty Images)
“I'm Jon Huntsman, and I'm running for President of the United States.”

--Former Utah governor Jon Huntsman(R)

Former Utah governor Jon Huntsman delivered his presidential announcement speech Tuesday, and we were prepared to fact check it as we have the other presidential announcement speeches.

 But not only was his speech fairly content-free, it was also fact-free. No slashing attacks on the president to check. No hyperbolic claims to debunk. No strange statistics seemingly conjured out of thin air.

 This certainly is in keeping with Huntsman’s strategy of being an unconventional candidate. Perhaps the former envoy to China believes that facts spouted by politicians are so devalued these days that it doesn’t make much sense to use them?  Anyway, here are a few things we found.


We are the most productive society on earth. We have the finest colleges and universities.”

The Huntsman campaign says these lines are just “figures of speech” and are not intended to be factual.

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By  |  06:00 AM ET, 06/22/2011 |  Permalink  |  Comments ( 0)
Categories:  Jon Huntsman, Candidate Watch


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