How we make the call
Truth Squad assigns five ratings to the political statements we review, in descending levels of accuracy:
|Who:||Bernie for America|
|What:||30-second TV ad, “Works for Us”; and 60-second ad, “Real Change”|
Launched on Feb. 19 in markets across Michigan, the two ads – largely positive in tone – push the populist economic message of Vermont Sen. Bernie Sanders. The themes are by now trademarks of his insurgent Democratic campaign, as he challenges a political and economic system Sanders says is rigged in favor of the extremely affluent. Among his prescriptions: higher taxes on the wealthy and corporations, free public college tuition for all and – though not stated in these ads – universal health care. Coming a week after the March 1 Super Tuesday showdown and other Democratic caucuses and primaries in the days leading to March 8, Michigan’s primary could be a key battleground for Sanders as he strives to prove his message can resonate in his battle against former Secretary of State Hillary Clinton in states with a diverse electorate.
Relevant text of the ads
“While our people work longer hours for lower wages, almost all new income goes to the top 1 percent...My plan will make Wall Street banks and the ultra-rich pay their fair share of taxes...He’s (Sanders) supporting veterans...He's fighting for...tuition-free public colleges.”
Statements under review
“While our people work longer hours for lower wages, almost all new income goes to the top 1 percent."
The message is at the heart of Sanders' campaign, but both claims in the above statement are without strong backing. As first noted by Politifact, the highly regarded research arm of the Tampa Bay Times, data from the Bureau of Labor Statistics show that the average weekly work hours of nonsupervisory and production workers has actually gone down since the 1960s, while Gallup surveys indicate the hours worked by fulltime employees has remained essentially flat between 2001 and 2014. The Brookings Institute did find an increase in working hours among women in the middle 10 percent of families since the great recession, even as wages stayed flat.
Sanders’s statement that “almost all” new income has gone to the wealthiest 1 percent of wage earners is likewise an exaggeration. Though the senator is correct in noting the increased concentration of wealth among the very affluent.
In 2013, the Pew Research Center released a study of wealth inequality dating back to 1917. Built on analysis of IRS tax data by Emmanuel Saez, an economics professor at the University of California-Berkeley, it found the income disparity in 2007 between the top 1 percent and bottom 90 percent had reached levels not seen since 1928. Saez estimated the top 1 percent in 2012 accounted for nearly 23 percent of pretax income, compared with less than 50 percent for the bottom 90 percent. By comparison, the top 1 percent share of income in 1944 was 11.3 percent, while the bottom 90 percent received nearly 68 percent, levels that remained relatively constant for the following three decades.
A 2015 study by PEW concluded the U.S. middle class has been steadily losing ground over the past decades, finding that 49 percent of aggregate income went to upper-income households in 2014, up from 29 percent in 1970. The portion going to middle-income households, meanwhile, fell from 62 percent in 1970 to 43 percent in 2014.
So there is little question the wealthiest of Americans have benefitted disproportionately compared with average wage-earners. But that’s not what Sanders’s Michigan ad claims; it insists that one-percenters have captured “almost all” new income, again relying on economist Saez of Berkeley. It’s true that in January 2015, Saez released a paper indicating that the top 1 percent had taken in 91 percent of income gains in the first three years of recovery from the recession, which is close enough to support the “almost all” statement.
But Saez updated his data in June of last year, lowering the estimated gains of the most affluent to “only” 58 percent, a change that even Sanders acknowledged in September on the Senate floor. This updated estimate shows it’s still good to be rich, but that estimate does not come close to equating to “almost all” income gains.
And it begs the question: Why does Sanders gild the lily in his Michigan ad, when data supports his central argument that the ultra-rich are disproportionately benefitting in the nation’s economic recovery?
“My plan will make...the ultra rich pay their fair share of taxes.”
This tax shift is aimed at paying for Sanders's most ambitious proposal – a government-run system of universal health care. Among other proposals, Sanders wants to raise the top tax rates – now at 33 percent, 35 percent and 39.6 percent for households earning more than $250,000 – to 37 percent, 43 percent, 48 percent and 52 percent, the latter for those making more than $10 million. Sanders would also impose an additional 10 percent surtax on billionaires and repeal capital gains tax rates for couples making more than $250,000. Sanders pays for his healthcare plan in part by imposing a 2.2 percent “health care premium” tax, as well as a 6.2 percent payroll tax paid for by employers. And while middle-class taxpayers pay higher taxes under this plan, the Sanders campaign maintains those costs will be more than made up by savings in health care premiums.
But analysis by PolitiFact concluded the Sanders plan would need to cut costs by 42 percent to 47 percent for the math to work – savings deemed unrealistic by more than one economic analyst. Analysis by the Tax Foundation, a conservative independent tax policy research organization, concluded that Sanders’ plan would lower after-tax income by 10.5 percent for all taxpayers and by 17.9 percent for the wealthiest Americans. Recently, Sanders’s campaign has also come under assault by a few progressive economists for promising gains from his economic plan that, these progressives say, “cannot be supported by the economic evidence.”
Left unassessed, and unassessable, is whether Sanders’s plan for more heavily taxing the super rich would amount to this group paying its “fair” share. What constitutes the wealthy’s “fair share” is at the heart of the divergent economic worldviews of progressives and conservatives, and cannot be decided by Truth Squad.
Sanders' campaign website states: “ Sen. Sanders believes that just as planes and tanks and guns are a cost of war, so is taking care of the men and women who we sent off to fight the war.” It omits his role as chairman of the Senate Committee on Veterans Affairs when reports emerged in late in 2013 that dozens of veterans died waiting for medical care in VA hospitals. One veterans official said Sanders “did not live up to his responsibilities” as chairman, while another said that Sanders was slow to hold hearings holding the VA accountable. “The House needed a partner in the Senate to help flesh out the problems at the VA, and unfortunately Bernie Sanders was not that partner,” said Dan Caldwell, vice president for political and legislative action for Concerned Veterans of America. To be sure, Sanders helped pass a $16 billion measure approved by the Senate in July 2014 aimed at improving veterans access to medical care. But Paul Rieckhoff, founder and CEO of the Iraq and Afghanistan Veterans of America, said Sanders had for considerable time ignored the appeals of organizations like his to dig into the issue. “For far too long he was apologizing for the VA. He was refusing to acknowledge the severity. He was positioning it as a smaller issue than it was while veterans were dying waiting for care,” Rieckhoff stated. In May 2014, Sanders said in an interview: “Did the delays in care of these people on the secret waiting list actually cause these deaths? We don't know.”
"He's fighting for...tuition-free public colleges."
It's no surprise this proposal is especially well received among younger voters, many of whom are saddled with tens of thousands of dollars in college debt. This burden stems from rapidly escalating tuition rates, the causes of which are hotly debated. According to the State Higher Education Executive Officers, students paid $64 billion for tuition in 2014, compared with $21.5 billion in 2000. Sanders would pay for this plan – at an estimated cost of $75 billion a year – by imposing fees on stock trades and bonds and derivative transactions. But Sanders also expects states to pick up one third of the cost of the $75 billion plan, which could be an unrealistic assumption. And without that funding, the plan could fall apart. For example, 17 states have thus far rejected expansion of Medicaid, even though its cost is 100 percent funded by the federal government in its initial years, 90 percent after that. In order to fund free tuition, states would presumably have to cut somewhere else. “There's not a lot of extra money to spend on other programs,” said Brian Sigritz, state fiscal studies director for the National Association of State Budget Officers.
Sanders points to an issue that is receiving national attention: The growing wealth and income gap in America. He is tapping into economic frustrations of workers as well as the young over stagnant wages and rising college debt. As his plans for free-tuition college and universal health care receive a closer look during the campaign, critics are raising important questions about how these plans will be funded and whether their fundamental financial assumptions are sound.
But the question of whether his economic plans hold up under rigorous analysis is for another day, most likely when Sanders and Clinton hold their debate in Flint two days before the Michigan primary. In these ads, Sanders is not vouching for the numbers in his tax plans. Rather, he is merely highlighting what he says he will do if he becomes president; namely, impose higher taxes on the wealthy and offer free tuition for students at public colleges. He is unquestionably fighting for both.
As for his support for veterans, the term “support” is so vague as to be almost meaningless, and thus difficult for Truth Squad to assess. What presidential candidate doesn’t support the troops, in some respect?
Where Sanders runs afoul of Truth Squad are his claims that people are working longer hours, and that the super rich are gobbling up “almost all” income gains. The weight of available evidence shows lack of support for both remarks. These are unforced errors, which could have been easily remedied with tweaks to the language that could more solidly support Sanders’s larger messages on income inequality and an economy that hasn’t been kind to the middle class. He did not make them.