Fact-checking Night 1 of 1st Democratic presidential debate
The first 2020 Democratic presidential debate kicked off in Miami with 10 candidates trying to stand out in a crowded field.
They took on taxes, equal pay, health insurance, gun control and immigration reform.
Here are the facts.
Insurance industry profits
Massachusetts Sen. Elizabeth Warren said the insurance industry last year “sucked $23 billion in profits out of the health care system.”
Facts First: It’s true. Insurance companies’ profits have been booming.
A study by the National Association of Insurance Commissioners shows the private insurance industry has seen “tremendous growth” raking in profits of $23.4 billion in 2018 compared to $16.1 billion the year before. That’s the highest profit amount in at least 10 years.
It also shows that those companies’ profit margin improved to 3.3% from 2.4% in 2017.
-Donna Borak and Tami Luhby
America’s wealth
Ohio Rep. Tim Ryan claimed that “the top 1% control 90% of the wealth.”
Facts First: This is incorrect. Recent studies show the wealthiest 1% own around 39% of the country’s total wealth.
According to the Center on Budget and Policy Priorities, a nonpartisan research institute, “the share of wealth held by the top 1 percent rose from just under 30 percent in 1989 to nearly 39 percent in 2016.”
This concurs with a Federal Reserve study which found that in 2016, the richest 1% controlled 38.6% of wealth in the US.
According to a 2017 study by NYU economist Edward Wolff, the top 1% own 40% of the wealth in the US.
-Holmes Lybrand
A market for green products
Sen. Elizabeth Warren said, “There’s a $23 trillion market coming for green products.”
Facts First: According to a World Bank estimate, that’s correct.
Warren was referring to a report by the International Finance Corporation, a division of the World Bank Group, which found that commitments made by emerging economies under the 2015 Paris Climate Agreement potentially will open up to $23 trillion in opportunities for investment in low-carbon technology and infrastructure.
-Lydia DePillis
Violence in Cory Booker’s neighborhood
New Jersey Sen. Cory Booker often notes on the campaign trail that he lives in a low-income, inner-city area. During Wednesday night’s debate, the former Newark mayor said that seven people were shot in his Newark neighborhood last week.
“I hear gunshots in my neighborhood,” Booker said. “I think I’m the only one, I hope I am the only one that had seven people shot in their neighborhood just last week.”
Fact Check: It’s sad, and it’s true.
Six people were injured and one man died in two separate shootings in Newark’s Central Ward, where Booker lives, the Tuesday before last, according to Newark Public Safety Director Anthony Ambrose.
Two women were injured and one man was killed in the first shooting, just before 4 p.m., Ambrose said in a press release. Five minutes and about a mile away, four men were injured in another shooting, Ambrose said.
Booker lives just a block away from that first shooting.
–David Shortell
Household income
Ohio Rep. Tim Ryan claimed that “the bottom 60% haven’t seen a raise since 1980.”
Facts First: This is incorrect. The bottom 60% have seen their income rise since 1980.
It’s unclear where Ryan is pulling this statistic from, but a 2018 report from the Congressional Budget Office says that the bottom 60% saw an increase in household income of 32% — adjusted for inflation — from 1979 to 2015.
Meanwhile the top 1% saw their income rise by 233%.
-Holmes Lybrand
Gun control
New Jersey Sen. Cory Booker said, “If you need a license to drive a car, you should need a license to buy and own a firearm. And not everybody in this field agrees with that, but in states like Connecticut that did that, they saw 40% drops in gun violence and 15% drops in suicides.”
Facts First: There is peer-reviewed academic support for this claim.
Booker was referring to the effects of a 1995 law that required a permit or a license to obtain a firearm, raised the age of people allowed to own guns from 18 to 21, and required 8 hours of gun safety training. A 2015 study published in the American Journal of Public Health found that the law was associated with a 40% drop in the firearm-related homicide rate.
A 2015 study in the journal Preventive Medicine found that the law decreased the firearm suicide rate by an estimated 15.4%.
– Lydia DePillis
Prison population
Former Texas Congressman Beto O’Rourke brought a stark figure into the debate on Wednesday night: “Tonight in this country you have 2.3 million of our fellow Americans behind bars. It’s the largest prison population on the face of the planet.”
Facts First: Comparing prison populations between nations is difficult because not all countries keep statistics in the same way. O’Rourke is broadly correct about the number of people behind bars in the United States but because of mass detentions in China, for instance, his claim that the US has the largest prison population on the planet is questionable.
According to an analysis of Justice Department numbers done by the Pew Research Center, there were about 2.2 million people behind bars in the US in 2016 between federal and state prisons and locally run jails.
China comes in at number two with 1,649,804 people imprisoned, according to the World Prison Brief, a database compiled by Birkbeck, University of London.
But measuring prison populations in China isn’t easy, the World Prison Brief notes, citing China’s use of “administrative detention facilities” for some drug offenders and prostitutes. There may also be as many as 3 million Chinese Uyghurs, a Muslim-majority ethnic group, in government detention camps, US Assistant Secretary of Defense Randall Schriver said last month.
–David Shortell
Medicare for All
Sen. Amy Klobuchar on Medicare for All: “I’m concerned about kicking half of Americans off of health insurance in four years.”
Facts First: True. Medicare for All would cut private insurance for 150 million people.
The Senate’s Medicare for All bill, sponsored by Vermont Sen. Bernie Sanders, would essentially eliminate the private insurance industry after a four-year transition. Instead, all Americans would be enrolled in a government-run plan, which would cover virtually all medically necessary services. Private insurers could only offer other benefits, such as cosmetic surgery.
Currently, more than 150 million Americans get their health insurance through private plans offered by their employers, according to the Kaiser Family Foundation. Also covered by private insurance are the millions who buy policies on the individual exchange or through Medicare Advantage plans. All of these consumers would be shifted from the policies to the national plan under Medicare for All.
-Tami Luhby
Corporate taxes
Sen. Cory Booker singled out companies like Amazon and Halliburton for “paying nothing in taxes.”
Facts First: Amazon and Halliburton’s tax rates are low, but not zero.
We can’t really know for sure because Amazon’s tax returns are private. But The Wall Street Journal reported recently that the company’s tax rate from 2012 through 2018 was 8%.
“From 2012 through 2018, Amazon reported $25.4 billion in pretax US income and current federal tax provisions totaling $1.9 billion,” the Journal reported. “That is an 8% tax rate — low, but not zero or negative. Looking back further, since 2002, Amazon has earned $27.7 billion in global pretax profits and paid $3.6 billion in global cash income taxes, a 13% tax rate.”
Amazon has been a Democratic target as a big winner of the 2017 Republican tax overhaul law.
Former Vice President Joe Biden blasted the company’s tax payments on the campaign trail during a stop in Iowa, and has tweeted that: “(N)o company pulling in billions of dollars of profits should pay a lower tax rate than firefighters and teachers,” pointing to Amazon.
The company tweeted back: “We pay every penny we owe. Congress designed tax laws to encourage companies to reinvest in the American economy. We have… Assume VP Biden’s complaint is w/the tax code, not Amazon.”
Halliburton was expected to make $19 million in tax payments on $1.1 billion in profit in 2018, according to a report by the Institute on Taxation and Economic Policy that showed how some of the country’s biggest companies had nearly zeroed out their income taxes.
-Donna Borak
Income inequality
When responding to a question about income inequality, Washington Gov. Jay Inslee said: “It is not right that the CEO of McDonald’s makes 2,100 times more than the people slingin’ hash at McDonald’s.”
Facts First: While technically true, it’s worth noting that this includes the wages of part-time employees working abroad, not just US-based employees.
McDonald’s reported that CEO Stephen Easterbrook’s total 2018 compensation was $15.9 million, while its median employee earned a total compensation of $7,473. That median employee however is a part-time employee located in Hungary.
Still, that dynamic resulted in a pay ratio of 2,124 to 1, according to a financial filing the company posted in April.
-Katie Lobosco
Insurance companies
Cory Booker said: “The overhead for insurers that they charge is 15%, while Medicare’s overhead is only at 2%”
Facts First: This is roughly true, although an apples-to-apples comparison is difficult to make.
According to the 2019 annual report from the Boards of Trustees for Medicare, administrative expenses come to $9.9 billion, or about 1.3% of Medicare’s total expenditures in 2018.
According to a report from the nonpartisan Congressional Budget Office in 2016, as a share of premiums per enrollee, the administrative costs of private insurance companies ranged between 11% and 20% depending on whether they serve large employers, small companies or the individual market.
Some of Medicare’s overhead costs are paid by the Social Security system, so the actual administrative expenses are likely higher, but it is true that Medicare’s administrative costs are lower as a share of overall expenditures than they are in the private market.
-Lydia DePillis
Immigration
Former Housing and Urban Development Secretary and San Antonio Mayor Julian Castro suggested that the Trump administration’s policy of limiting asylum at ports of entry led to the deaths of the Salvadorian father and child found face down in the Rio Grande that is the subject of a now infamous photo.
Facts First: ‘Metering’ has led to longer waits, but it’s unclear if those wait times resulted in the family deciding to cross illegally
“They have been playing games with people who are coming and trying to seek asylum at our ports of entry. Oscar and Valeria went to a port of entry and then they were denied the ability to make an asylum claim so they got frustrated and they tried to cross the river and they died because of that,” Castro said.
The Trump administration’s policy, called “metering,” has led to longer wait times, though it’s difficult to ascribe motive behind a migrant’s decision to cross the border illegally.
In the case of the father and child who died trying to cross the Rio Grande river, the man’s mother told CNNE that they left the country in April in hopes of making it to Dallas to work. She said the family wanted to buy their own house and better their financial situation.
Customs and Border Protection has said it doesn’t know how many migrants have been turned away as a result of metering.
-Priscilla Alvarez
Taxes
Former Texas Rep. Beto O’Rourke said that Congress passed “a $2 trillion tax cut” that favored corporations which were sitting on record piles of cash and the very wealthiest in the country at a time of historic wealth inequality.
Facts First: Though there are a variety of estimates projecting the cost of the 2017 Tax Cuts and Jobs Act, according to the Congressional Budget Office, O’Rourke’s statement appears to be roughly accurate.
Last year, the Congressional Budget Office projected that when incorporating the additional debt service costs, the tax cut would add $1.9 trillion to the deficit over the ten-year window.
But other cost estimates varied. According to an estimate by Congress’ Joint Committee on Taxation before the law passed, it would cost $1.4 trillion over ten years, or just over $1 trillion when incorporating a broader look at its economic impacts.
A year after the law passed, the conservative-leaning Tax Foundation found that the cost was even less, at $1.47 trillion on a conventional basis and $448 billion over the ten-year window when taking into account its effect on the economy.
-Lydia DePillis
This story is breaking and being updated.
