The Truth-O-Meter Says:
U.S. Chamber of Commerce

Says U.S. Rep. Tammy Baldwin, a candidate for Senate, supports raising taxes "by $858 billion."

U.S. Chamber of Commerce on Thursday, February 9th, 2012 in a TV ad

U.S. Chamber says Rep. Tammy Baldwin backed raising taxes $858 billion by voting against extension of Bush-era tax cuts

There was never any doubt that opponents of U.S. Rep. Tammy Baldwin of Wisconsin, a Madison Democrat running for the U.S. Senate, would brand her as a liberal who loves taxes.

On the day Baldwin announced her candidacy in September 2011, Republican Senate candidate Tommy Thompson called her the most liberal member of the House.

Based on annual ratings of House members’ votes, we gave Thompson a Mostly True on that claim.

Now two major business organizations say Baldwin loves taxes enough to raise them "by $858 billion" -- and they cite Baldwin’s own website as evidence.

A politician touting an $858 billion tax increase?

This could get interesting.

The claim is made in a TV ad sponsored by Wisconsin Manufacturers and Commerce and paid for by the U.S. Chamber of Commerce. The ad was released Feb. 9, 2012.

It begins with a narrator saying:

"Washington has made things tough for job creators. More red tape doesn't help. ‘Obamacare’ will kill jobs; Tammy Baldwin fought hard for it. Taxes? Tammy Baldwin thinks they're too low and wants to raise them."

At that point, a message on the screen reads: "Tammy Baldwin -- raise taxes by $858 billion" and lists Baldwin’s official House website as the source.

Is it an accurate attack?

‘Bush-era tax cuts’

The Wisconsin business group referred us to the U.S. Chamber, which referred us to the taxes page on Baldwin’s website. It discusses her vote against an $858 billion bill that extended what are known as the Bush-era tax cuts.

The tax cuts -- on income, capital gains, dividends and business -- were enacted in 2001 and 2003 under President George W. Bush. They were temporary -- their major provisions were to expire at the end of 2010.

The bill Baldwin voted against was adopted and signed into law in December 2010. On the web page cited by the chamber, Baldwin says she supported continuing the tax cuts only for families that earn up to $250,000, because "adding $858 billion to the national debt just to give a special tax break to those with incomes over $250,000 is fiscally irresponsible."

The ad’s claim about Baldwin is based on that single no vote.

But, as we’ll see, it wasn’t the only measure put to a vote in the House on extending the Bush tax cuts. And the $858 billion figure -- though widely cited -- is more complicated than presented in the ad.

What’s in the $858 billion

The law extends the Bush tax cuts two more years -- but it also provided a new, temporary payroll tax cut, made other tax changes and extended unemployment benefits for 13 months.

The total "cost" of the package -- in terms of how much it adds to federal budget deficits -- is estimated at nearly $858 billion over 10 years, according to the nonpartisan Congressional Budget Office.

About $721 billion of that is reduced revenue from the tax changes -- including $408 billion from the two-year extension of the Bush tax cuts -- and the rest is from additional spending.

So, does Baldwin’s vote against an $858 billion bill composed primarily of tax cuts mean she supported raising taxes by $858 billion?

Not exactly.

Had Baldwin’s side defeated the bill -- and had the Bush tax cuts been allowed to expire -- the people who benefited from those tax cuts would have been paying higher taxes as of January 2011.

But, as we’ve noted, the bill also contained other measures such as the new cut in payroll taxes and the extension of unemployment benefits. So, it can’t be argued that taxes would have been raised by a full $858 billion had Baldwin’s side prevailed.    

Secondly, had the $858 billion bill been defeated, it doesn’t necessarily mean the debate would have ended and that the Bush tax cuts would have expired; another bill could have emerged.

Baldwin campaign spokesman Phil Walzak pointed out that a week before the vote on the $858 billion bill that became law, Baldwin voted for an alternative that would have extended the Bush tax cuts, permanently, for families earning less than $250,000. The failed measure also would have made other changes that would have added a total of $1.5 trillion to the deficit over 10 years, according to the Congressional Budget Office. Nearly all of that, $1.34 trillion, would have been revenue lost from making most of the Bush tax cuts permanent.

To compare the two bills only in terms of extending the Bush tax cuts:

The bill Baldwin voted against reduces revenue by $408 billion for two years, or $204 billion on an annual basis.

The bill Baldwin voted for would have reduced revenue $1.34 trillion over 10 years, or $134 billion per year.  

So, Baldwin supported extending most of the Bush tax cuts, although taxes would have gone up for families earning $250,000 or more.

In the end, there were two votes on competing proposals. By using the approach the ad uses, Democrats would be able to argue that those who voted against the first, more limited package, opposed cutting taxes.

Our ruling

In a TV ad, the U.S. Chamber of Commerce says Baldwin supports raising taxes by $858 billion, citing her vote against a bill that primarily contained tax cuts.

It’s true that had Baldwin’s side prevailed and if no other action was taken, taxes would have increased, although not by the full $858 billion.

But Baldwin did vote separately for a measure that would have extended most of the Bush tax cuts. And it can’t be assumed that the Bush tax cuts would not have been extended had the bill Baldwin opposed not become law.

There’s only an element of truth in the chamber’s claim, which is our definition for Mostly False.

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About this statement:

Published: Wednesday, February 15th, 2012 at 3:44 p.m.

Subjects: Message Machine 2012, Taxes

Sources:

U.S. Chamber of Commerce, "Meet Tammy Baldwin" TV ad, Feb. 9, 2012.

Interview, Wisconsin Manufacturers and Commerce director of public policy Jim Pugh, Feb. 9, 2012

Email interview, U.S. Chamber of Commerce senior media relations manager Bryan Goettel, Feb. 9, 2012

Interview and email interview, Tammy Baldwin campaign spokesman Phil Walzak, Feb. 9 and 14, 2012

U.S. Rep. Tammy Baldwin website, taxes page

USA Today, "Congress hits stride at end of ‘lame duck’ session," Dec. 23, 2010

Associated Press, "New tax law is loaded with business goodies," Dec. 24, 2010

Orlando Sentinel, "Tax plan advances in Senate," Dec. 14, 2010

Fort Worth Star-Telegram, "A setback avoided as tax cuts are renewed," Dec. 29, 2010

McClatchy Newspapers, "Now it’s House’s turn to vote on $858 billion tax cut plan," Dec. 15, 2010

Congressional Quarterly House Action Reports, "Extension of tax cuts & unemployment benefits," Dec. 15, 2010

Congressional Quarterly House Action Reports, "Middle-class tax cut extension & AMT ‘patch,’" Dec. 1, 2010

Congressional Budget Office, estimate of changes in revenue and expenditures in $858 billion package Baldwin opposed, Dec. 10, 2010

Congressional Budget Office, estimate of changes in revenue and expenditures in amendment Baldwin supported, Dec. 2, 2010

Interview and email interview, Center for American Progress senior fellow Scott Lilly, Feb. 14, 2012

Interview and email interview, Tax Policy Center senior fellow Roberton Williams, Feb. 14 and 15, 2012

Interview and email interview, American Enterprise Institute resident scholar Alan Viard, Feb. 14 and 15, 2012

Written by: Tom Kertscher
Researched by: Tom Kertscher
Edited by: Greg Borowski

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