Ben Carson pitched a tax plan with numbers that didn’t add up. Chris Christie accused the government of stealing Social Security money that it has actually borrowed — and will pay back with interest.
Reality got twisted out of shape on a number of fronts in the fast-paced Republican presidential debate Wednesday night.
A look at some of the claims and how they compare with the facts:
CARSON: His proposed flat-rate tax, which would have everyone pay an income tax rate of about 15 percent, “works out very well” in budget terms because it would spark enough economic growth to offset the lower rate.
THE FACTS: Carson says his proposed tax would not increase the budget deficit because he would tax the entire economic output of the U.S. — the gross domestic product — plus corporate income and capital gains.
Carson has not laid out a detailed plan, so it is difficult to measure how it would affect revenues or the economy. But based on what he said, he’s double counting because corporate revenues are part of the GDP.
A tax rate of 15 percent would be a huge tax cut for the wealthy. The top income tax rate for individuals is now 39.6 percent. The corporate tax rate for corporations is 35 percent.
To help offset the rate cuts, Carson said he would “get rid of all the deductions and all the loopholes.” That’s a bold proposal, considering how popular many tax breaks are, including deductions for interest on home mortgages and charitable contributions, as well as exemptions for health insurance and retirement savings.
CHRISTIE: The federal government has “stolen” the Social Security taxes paid by workers and spent it on other things. “It isn’t their money anymore. … It got stolen from them. It’s not theirs anymore. The government stole it and spent it a long time ago.”
THE FACTS: The money is not stolen, it’s borrowed.
Over the past 30 years, Social Security has collected about $2.7 trillion more in payroll taxes than it has paid in benefits. By law, the Treasury Department has invested the surplus in U.S. Treasury bonds.
Over that same time period, the federal government has run budget deficits in all but a few years. To finance the deficits, the government has borrowed money, from other government agencies as well as public debt markets.
The money from Social Security has been spent, but Social Security holds Treasury bonds worth $2.7 trillion, backed by the full faith and credit of the U.S. government. Saying the money has been stolen assumes that the federal government will not honor the bonds.
SEN. RAND PAUL: The new budget agreement “will explode the deficit, it will allow President Obama to borrow unlimited amounts of money.”
THE FACTS: The agreement allows $80 billion more spending over the next two years, which is only a small addition to the $3.67 trillion the government spends every year. The government’s annual budget deficit has declined to $439 billion, about 2.5 percent of GDP, below the average for the past 40 years.
Overall, whatever its faults, most economists have responded to this week’s budget deal between Congress and the White House with a sigh of relief. The agreement, approved by the House earlier Wednesday, sets funding levels and extends the government’s borrowing limit for two more years, thereby taking the threat of a government shutdown and debt default off the table.
A 2013 budget fight led to a 16-day partial government shutdown that was widely blamed by most economists for sharp drops in consumer and business confidence that dragged on the economy.
CHRISTIE: FBI Director James Comey said police officers are holding back “because of a lack of support from politicians like the president of the United States.”
THE FACTS: That’s not what Comey said.
In a speech last week about an alarming rise in crime, Comey said some officers feel under siege because of the spread of viral videos taken by young people with cellphones. Comey said he had heard about one police official who told his force “their political leadership has no tolerance for a viral video.”
But Comey never mentioned Obama or blamed politicians for failing to support police. And Comey made clear he didn’t have data. Christie also said when Obama was asked to speak about the issue, he declined to support police. In fact, Obama gave a firm defense of police on Tuesday, telling a police chiefs convention that “this country is safer because of your efforts.”
