Ad Watch: Inslee, the stimulus and taxing small business

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by ROBERT MAK / KING 5 News

KING5.com

Posted on September 28, 2012 at 6:03 PM

Updated Thursday, Oct 25 at 1:03 PM

An ad sponsored by Republican Party group blasts Democratic gubernatorial candidate Jay Inslee for supporting wasteful government spending and higher taxes on businesses.

The ad criticizes Inslee for supporting "an $800 billion spending program that never delivered the promised jobs." (Watch the ad.)

Did Jay Inslee support a jobs program that failed to deliver?

The $800 billion program referred to in the ad is the stimulus bill passed by Democrats in 2009. At the time, President Obama and his allies said the stimulus plan would likely "save or create" 3 million to 4 million jobs.

Measuring the stimulus's actual results is not easy. The nonpartisan Congressional Budget Office concluded that the stimulus's effect peaked in 2010 and that somewhere between 700,000 and 3.6 million jobs could be attributed to it.

In 2009, a report written by two Obama economic advisers, said the stimulus would keep the national unemployment rate from rising above 8 percent. That didn't happen. After Obama took office, the unemployment rate continued to rise, hitting a peak of 10 percent in October 2009. It's lower today, but still above 8 percent -- the national rate for August was 8.1 percent.

Still, the ad's claim isn't cut and dry. Unemployment continued to rise for the first 10 months of the Obama administration and has not dropped as quickly as many hoped.

President Obama now says things could have been much worse without the stimulus. But there is no definitive study on whether the stimulus produced the 3 million to 4 million jobs that were promised.

Did Inslee vote to impose a big tax increase on small businesses?

The same ad also blasts Inslee for supporting a tax hike on business: "Local small businesses struggling to stay open and Inslee votes them a massive tax increase."

The so-called tax increase the ad is referring to is the health care reform law that Congress passed in 2010 (or "Obamacare," as many supporters and opponents refer to it).

Under the law, employers must offer health insurance to workers by 2014, or pay a fine. Some call that fine a penalty, while others -- Republicans especially -- call it a tax increase on businesses.

Conclusion

If this ad had simply claimed that Inslee supported penalties on businesses, it would have been true.

The problem with the commercial's health care claim relates to the ad's imagery. The ad implies that this woman --
standing outside her coffee shop -- would have to pay higher taxes because of Inslee's vote.

Under the health care reform law, however, the penalty for not providing health insurance only applies to businesses with more than 50 employees. An independent coffee shop isn't likely to have that many workers.

For that reason, KING 5 finds this claim -- and the impression it leaves -- to be deceptive.
 

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