OBAMA: “We began by passing a Recovery Act that has already saved or created over 150,000 jobs.” – from news conference.
THE FACTS: This assertion is dubious on several levels. For starters, the U.S. has lost more than 1.2 million jobs since Obama took office, according to the Bureau of Labor Statistics. Even if Obama’s stimulus bill saved or created as many jobs as he says, that number is dwarfed by the number of recent job losses.
But Obama’s number is murky, at best. The White House has not yet announced how it intends to count jobs created by the stimulus bill. Obama’s number is based on a job-counting formula that his economists have developed but have not made public. Until that formula is announced – probably in the coming week or so – there’s no way to assess its accuracy.
Whatever the formula, economists who study job creation say it will require some creative math. That’s because Obama has lumped “jobs saved” in with “jobs created.” Even economists for organizations that stand to benefit from the stimulus concede it probably is impossible to estimate saved jobs because that would require calculating a hypothetical: how many people would have lost their jobs without the stimulus.
On health care:
OBAMA: “I think one basic principle that we know is that the more we do on the (disease) prevention side, the more we can obtain serious savings down the road. … If we’re making those investments, we will save huge amounts of money in the long term.” – in Missouri.
THE FACTS: It sounds believable that preventing illness should be cheaper than treating it, and indeed that’s the case with steps like preventing smoking and improving diet and exercise. But during the 2008 campaign, when Obama and other presidential candidates were touting a focus on preventive care, the New England Journal of Medicine cautioned that “sweeping statements about the cost-saving potential of prevention, however, are overreaching.” It said that “although some preventive measures do save money, the vast majority reviewed in the health economics literature do not.”
And a study released in December by the Congressional Budget Office found that increasing preventive care “could improve people’s health but would probably generate either modest reductions in the overall costs of health care or increases in such spending within a 10-year budgetary time frame.”
On entitlement reform:
OBAMA: “You could cut (Social Security) benefits. You could raise the tax on everybody so everybody’s payroll tax goes up a little bit. Or you can do what I think is probably the best solution, which is you can raise the cap on the payroll tax.” – in Missouri.
THE FACTS: Obama’s proposal would reduce the Social Security trust fund’s deficit by less than half, according to the nonpartisan Tax Policy Center.
That means he would still have to cut benefits, raise the payroll tax rate, raise the retirement age or some combination of these measures to deal with the program’s long-term imbalance.
Workers currently pay 6.2 percent and their employers pay an equal rate – for a total of 12.4 percent – on annual wages of up to $106,800, after which no more payroll tax is collected.
Obama wants workers making more than $250,000 to pay payroll tax on their income over that amount. That would still protect workers making under $250,000 from an additional burden. But it would raise much less money than removing the cap completely.