Fact-check Kevin McCarthy’s 8-hour speech

Representative Kevin McCarthy, the Republican from California and the minority leader, raised his case against President Biden’s law on social spending in a record-breaking speech that spanned more than 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, Congressman Abigail Spanberger said no one chose Joe Biden to be FDR. This uses even more than FDR while fighting a world war.”

This is misleading. Expenditure and tax cuts in the bill will add up to about $ 2 trillion over 10 years, and they could rise to $ 4 trillion if shortened programs are extended.

That’s actually a larger dollar amount than the New Deal programs passed under President Franklin D. Roosevelt, which cost about $ 800 billion after adjusting for inflation, according to a report from the Federal Reserve Bank of St. Louis. Louis. But World War II itself cost about $ 5 trillion.

In addition, comparing New Deal programs with the social spending bill should take into account changes in the U.S. economy and population size. The report from the Federal Reserve Bank of St. Louis also noted that the cost of the New Deal amounted to 40 percent of the annual gross domestic product.

By comparison, the $ 1.9 trillion stimulus package signed by Mr Biden in the law in March and his initial proposal for a $ 4 trillion economic plan – which became the austerity measure and the bill for social spending – would total 28 percent of GDP

What Mr. McCarthy said

“You hire 87,000 IRS agents to go after them, 1.2 million more audits, and half of all the 1.2 go after Americans who earn $ 75,000 or less.”

This is misleading. The bill provides the IRS with $ 80 billion in additional funding, including nearly $ 45 billion for enforcement. The Congressional Budget Office noted in September that the proposal would result in increased audit rates for all, with high incomes facing the largest increase.

The bill does not contain any details governing how audits will be spread among taxpayers with different incomes, and the Biden administration and Republicans disagree on how it will play out.

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

A spokeswoman for Mr. McCarthy pointed to calculations by Republicans in the House Ways and Means Committee that compared historical revision data.

In the past decade, tax audit rates have fallen for higher-income earners and have remained relatively stable for lower-income earners, which the Treasury attributed to the IRS’s reduced resources and inability to retain specialized auditors needed to examine the filings of the wealthy. .

The IRS examined 1.4 million individual tax returns in 2010, about 1 percent of the total number filed. In 2018, the most recent year with available data, revisions dropped to 370,000, or about 0.2 percent.

The Congressional Budget Office estimated that the bill would bring enforcement back to the 2010 level. Doing so would actually result in about 1.2 million more revisions, and about 580,000 of them would affect people earning less than $ 75,000.

But that’s because a large majority of taxpayers – about 70 percent – earn below that threshold. Looking at what fraction of the return is examined by income group, rather than the mere number, shows that richer taxpayers would have a better chance of being audited than lower-income earners under the Democrats’ proposal.

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

This is misleading. This was a reference to a proposal from the Treasury that requires banks to report total annual flows of $ 10,000 or more in customer accounts to better tackle tax evasion. (An earlier version of the proposal proposed $ 600 flow monitoring.) Wages and federal benefits are exempt from the reporting requirement, and banks will not report individual transactions. But this proposal did not enter into the law on social spending.

In a fact sheet, the Treasury Department said it was a “misunderstanding” that all Americans would face greater scrutiny under the proposal.

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

What Mr. McCarthy said

“We will take tax from you so that someone who earns $ 800,000 can get a tax deduction for buying a Tesla.”

False. The Democrats’ bill will increase the tax deduction for electric vehicles to $ 12,500 from $ 7,500 if the car is made in the United States with union work and if its battery is also domestically produced. 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 starts in the mid-$ 40,000s, 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 registries earning $ 500,000 or less) can claim the credit under the bill.

What Mr. McCarthy said

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

False. Early in his presidency, Mr. Biden the building permit for the Keystone XL oil pipeline, and the company behind the project completed it completely in June. Mr. McCarthy wildly exaggerated the effect of the pipeline on employment.

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

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

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

What Mr. McCarthy said

“Biden ended any successful immigration policy that President Trump had put in place, triggering the biggest wave of illegal immigration in all of history.”

This is exaggerated. Sir. Biden has rightly repealed many of President Donald J. Trump’s immigration policies, but he has also kept a key policy intact.

While the Biden administration has lifted the so-called Muslim ban, halted construction of Trump’s border wall and stopped carrying out immigration attacks in the workplace, it continues to use a public health rule that allows officials to reject hundreds of thousands of migrants on the ground. limit.

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

What Mr. McCarthy said

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

This is misleading. The bill itself does not provide hundreds of thousands of dollars to unauthorized immigrants. Rather, it was a reference to a proposal to provide monetary compensation for damages inflicted by an 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 were separated from their parents. The Wall Street Journal reported that the lawsuits seek compensation of varying range and average $ 3.4 million per family.

The Biden administration and family lawyers have been negotiating to provide $ 450,000 for each family member affected, but The New York Times reported that only a minority of families would be eligible, as many have not filed complaints against the government.

When asked about the number this month, Mr. Bite “it’s not going to happen.” A White House spokeswoman later clarified that the Department of Justice had told the plaintiffs that the $ 450,000 figure was “higher than anywhere else a settlement can land.”

What Mr. McCarthy said

“Mr. Speaker, you may remember the Iron Dome. Your party has actually defused it.”

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

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