Kevin McCarthy's 8-Hour Speech Fact Check

Rep. Kevin McCarthy, Republican of California and leader of the Minority, mounted his case against President Biden’s social spending bil...

Rep. Kevin McCarthy, Republican of California and leader of the Minority, mounted his case against President Biden’s social spending bill in a record speech which lasted over eight hours from Thursday to Friday.

Here is a fact-check of some of his remarks.

What Mr. McCarthy Said

“Just a few weeks ago, Congresswoman Abigail Spanberger said that no one elected Joe Biden to be FDR. It even spends more than FDR while fighting a world war.”

It is misleading. The spending and tax cuts provided for in the bill will total approximately $ 2,000 billion over 10 years, and could snowball into $ 4 trillion if the short programs are prolonged.

This is indeed a higher amount than the New Deal programs adopted under President Franklin D. Roosevelt, which cost approximately 800 billion dollars after adjusting for inflation, according to a report by the Federal Reserve Bank of St. Louis. But World War II itself cost approximately $ 5,000 billion.

In addition, the comparison of New Deal programs with the Social Expenditure Bill should take into account changes in the economy and population size of the United States. The Federal Reserve Bank of St. Louis report also noted that the cost of the New Deal was 40 percent of annual gross domestic product.

By comparison, the $ 1.9 trillion stimulus package Mr Biden enacted in March and his initial proposed $ 4 trillion economic plan – which became the scaled-down infrastructure measure and the social spending – would together represent 28% of GDP.

What Mr. McCarthy Said

“You hire 87,000 IRS agents to prosecute them, 1.2 million more audits, and half of those 1.2 go after Americans making $ 75,000 or less.”

It is misleading. The bill provides the IRS with $ 80 billion in additional funding, including nearly $ 45 billion for enforcement. The Congress Budget Office noted in September that the proposal would result in increased verification rates for everyone, with higher-income earners facing the largest increase.

The bill contains no details of how the audits would be distributed among taxpayers of different income, and the Biden administration and Republicans disagree on how that would play out.

The Treasury Department said in a May report on the proposition that tax audit rates would not increase for those earning less than $ 400,000, because “compliance proposals are designed to improve existing inequalities by focusing on high-end evasion” .

A spokeswoman for Mr McCarthy pointed out calculations Republicans on the House Ways and Means Committee which historical audit data compared.

Over the past decade, tax audit rates have declined for high-income earners and have remained relatively stable for low-income earners, which the Treasury Department has attributed to dwindling IRS resources and the inability to retain the specialist auditors needed to examine the files of the wealthy.

The IRS reviewed 1.4 million personal income tax returns in 2010, or about 1% of the total number filed. In 2018, the latest year for which data is available, audits increased to 370,000, or around 0.2%.

The Congressional Budget Office estimated that the bill would bring enforcement back to its 2010 levels. This would indeed result in around 1.2 million additional audits, and around 580,000 of these would affect people earning under 75. $ 000.

But that’s because a large majority of tax filers – around 70% – earn below this threshold. Looking at the fraction of returns reviewed by income group, rather than just the number, shows that wealthier taxpayers would have a better chance of being audited than low-income people under the Democrats’ proposal.

Below 2010 enforcement levels, approximately 0.5% of returns reporting between $ 1 and $ 75,000 in income would be audited, as would 1% of those with income above $ 75,000. In comparison, these rates were 0.3% and 0.1% in 2018. For those earning more than $ 10 million, more than 20% of returns would be examined below 2010 levels, compared to 5.3% in 2018.

What Mr. McCarthy Said

“All you have to do as an American is spend $ 28 and the IRS is going to knock on your door.”

It is misleading. It was a reference to a Treasury Department proposal requiring banks to report cumulative annual flows of $ 10,000 or more on accounts receivable to better combat tax evasion. (A previous version of the proposal suggested monitoring debits of $ 600.) Wages and federal benefits are exempt from the reporting requirement, and banks will not report individual transactions. But this proposal did not find its way into the social spending bill.

In an information sheet, the Treasury Department said it was a “misconception” that all Americans would be subject to further scrutiny under the proposal.

Michelle Nessa, an accounting professor at Michigan State University and an expert in tax audits, said the bank reporting requirement was “unlikely to significantly increase audit risk for most people.”

What Mr. McCarthy Said

“We’re going to take taxes from you so that someone who earns $ 800,000 can get tax relief to buy a Tesla.”

False. The Democrats’ bill would increase tax credits for electric vehicles from $ 7,500 to $ 12,500 if the car is made in the United States with unions and its battery is also produced domestically. The credits cover sedans that cost up to $ 55,000 and zero-emission vans, SUVs and trucks that cost up to $ 80,000, so the Tesla Model 3, which begins in the mid-1940s, would qualify.

But the hypothetical near-millionaire in Mr. McCarthy’s example would not qualify, as only individuals earning $ 250,000 or less (and joint filers earning $ 500,000 or less) can claim the credits under the invoice.

What Mr. McCarthy Said

“More than a million people lost their jobs after President Biden was sworn in because he closed a pipeline. “

False. At the start of his presidency, Mr. Biden canceled the Keystone XL pipeline construction permit and the company behind the project ended quite in June. Mr. McCarthy greatly exaggerated the effect of the pipeline on employment.

The company itself has valued that the pipeline would employ approximately 11,000 Americans. The State Department, in a 2014 report, estimated that it would support around 42,000 temporary jobs during two years of construction and 35 permanent employees after the initial phase.

Mr McCarthy may have been referring to a 2020 analysis from the American Petroleum Institute, the largest trading group in the oil and gas industry, which estimated that nearly a million jobs would be lost by 2022 if drilling was banned on federal lands – not because of the cancellation of a pipeline.

Mr. Biden banned new oil and gas leases on federal lands, but did not cancel existing leases. In addition, in June, a federal judge blocked by the administration the suspension of new leases. The approval of leases actually increased under Mr. Biden, just as employment in oil and gas extraction.

What Mr. McCarthy Said

“Biden ended all successful immigration policies put in place by President Trump, triggering the biggest wave of illegal immigration in history. “

It’s exaggerated. Mr. Biden has indeed repealed many of President Donald J. Trump’s immigration policies, but he has also kept one key policy intact.

While the Biden administration has canceled the so-called Muslim ban, construction stopped Mr. Trump’s border wall and stopped carrying out immigration raids in the workplace, he continues to use a public health rule which allows the authorities to turn back hundreds of thousands of migrants at the border.

In addition, the Biden administration tried to end a Trump-era program which forced asylum seekers to wait in Mexico while their claims were reviewed, but it was ordered to restart the program.

What Mr. McCarthy Said

“You provide money, $ 450,000, to the people who came here illegally, and you take it from the hard-working American taxpayers.”

It is misleading. The bill itself does not provide hundreds of thousands of dollars for unauthorized immigrants. Rather, it was a reference to a proposal to provide monetary compensation for the damage inflicted by a Trump-era immigration policy.

The American Civil Liberties Union and others have filed lawsuits on behalf of migrant families separated at the border by the Trump administration. About 5,500 children have been separated from their parents. The Wall Street Journal reported that lawsuits seek damages of different ranges and an average of $ 3.4 million per family.

The Biden administration and the families’ lawyers have started negotiations to provide $ 450,000 to each affected family member, but The New York Times reported that only a minority of families would be eligible because many have not filed a complaint against the government.

Asked about the figure this month, Mr Biden said “it won’t happen”. A White House spokeswoman later clarified that the Department of Justice had told complainants that the figure of $ 450,000 was “higher than anywhere a settlement can lead”.

What Mr. McCarthy Said

“Sir. Mr. President, you may remember the Iron Dome. Your party actually funded this.

False. Despite opposition from Progressive Democrats to funding Israel’s Iron Dome missile defense system, the House voted 420 to 9 in September to provide $ 1 billion in new funding. Democrats voted overwhelmingly for funding.

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Newsrust - US Top News: Kevin McCarthy's 8-Hour Speech Fact Check
Kevin McCarthy's 8-Hour Speech Fact Check
Newsrust - US Top News
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