Checking the Factcheckers (Part Two)

Seventy-seven percent is not enough

Factcheck accuses Lilly Ledbetter and Laura DeLauro of exaggeration when they stated that women earn 77% of what men earn. The figure is an official one, published by the Bureau of the Census, so Factcheck is wrong to single out this figure for special analysis. Factcheck claims that the gap between what men and women earn for the same job is much less.

The situation for women is far worse than what the single figure 77% represents. This figure compares the earnings of full-time, year-round wage earners. Other figures show women in a much more desperate plight. Families headed by women have incomes only 65% of those headed by men. Both figures are medians; half of women earn more than 77%, but half earn less.

The disparity between the sexes becomes even greater when measured over longer periods of time. A 2004 study by the Institute for Women's Policy Research found that women between the ages of 26 and 59 made only 38% of their male counterparts over a 15-year period. More than 50% of women between those ages had a full calendar year without earnings, while only 16% of men did.

Not only did Factcheck's researchers call the 77% claim false, they also discovered sources who claimed that women were better off than the figure implies. They should have investigated further and they would have found the gender gap is just the tip of the iceberg that is the gender gap.

The Bain Bailout 

The story of the Bain & Company bailout was related in an article in the Rolling Stone. The article leaves out some important details, such as how much money Romney received personally from the federal bailout, because the article was based on documents obtained under the Freedom of Information Act from which most of the dollar sums had been deleted. Romney, true to form, refuses to release the information, but it is fair to assume he made millions from the deal. 

Factcheck explains that the federal bailout of Bain was a routine settlement with bank regulators that involved no taxpayer money. It defines the FDIC as an independent federal agency, but the FDIC is backed up by the full faith and credit of the US government. Factcheck says the settlement resulted in no loss to taxpayers, because the FDIC is funded by fees paid by banks. Factcheck would have us believe that taking $14 million from the FDIC as part of a bankruptcy settlement harms no one.

The FDIC is funded by fees, but whether they are called fees or taxes they are paid by taxpayers. The $14 million taken by Romney and Bain & Company came out of taxpayer pockets. The rates paid by depositors are higher because of deals like this one. 

Factcheck only muddies the waters

A fact is just a fact. Its understanding does not require a dissertation on whether the facts underlying assumptions are correct. When Democratic speakers used the figure of 77% to describe the gender gap, they took the figure from the US Census Bureau. That's the fact, not the wealth of quibbles unearthed by Factcheck. When Democratic speakers stated that Romney went to the US government to get a bailout for his company, that's a fact. The FDIC is a federal agency. Romney arranged a deal for his company with the FDIC.

Claiming that facts are false because of details obscures the issues involved here. It doesn't matter whether Romney owned Bain & Company when he negotiated the bailout. The important part of the Bain story is that Romney went to the federal government, asked for and got $14 million for Bain & Company, and profited richly from the deal. 

Romney opposes federal aid to poor people, however, because, one might say, suffering builds character. But he favors federal aid to the rich, including the undisclosed amount of federal funds he received from the FDIC for arranging a bailout. One of the aspects of the bankruptcy revealed by the Rolling Stone was that Romney inserted a clause in the bankruptcy agreement that distributed $5 million in bonuses to the executives of the company if creditors challenged it.  The wealthy financiers of this country have developed some very shoddy business practices by taking advantage of tax loopholes and federal agencies. That is the story of Bain & Company, and that is the story of Mitt Romney.