Fact Check: Ad Takes Obama to Task on Jobs, Regulations

By Steve Kanigher

Published 10/02 2012 12:15PM

Updated 05/25 2015 02:20AM

Claim: An advertisement endorsed by Republican-leaning super political action committee American Crossroads that has aired on KLAS-TV Channel 8 features business owners Sherry Wuebben and Bill Schams. Wuebben: "Small businesses like ours are what have driven this country and President Obama just doesn't seem to understand that." Schams: "There's a reason there aren't more jobs. Obama has made a lot of bad decisions. He treats us like we are his enemy." Wuebben: "He's increased our taxes. He's increased our health care expenses." Schams: "We've got so many regulations that you can't keep up on, and you don't know what more is coming down the pike. Obama definitely is making things harder for us."

Verdict: Partly true and partly misleading. Regarding Wuebben's first claim, President Barack Obama's administration has addressed the need to help small businesses on numerous occasions, such as by advocating easier access to loans for those enterprises. The administration stated in January 2011 that "small businesses play an essential role in the American economy … During a recent 15-year period, small businesses created more than 60 percent of all new jobs in the nation." To Schams' claim about lack of jobs, Republicans have argued that the economic stimulus package backed by Obama and fellow Democrats failed. Democrats counter that the economy would have worsened without the stimulus. Obama's critics point to unemployment that still exceeds 8 percent nationally and is mired in double digits in Nevada. But the nation is still feeling the aftershocks of a deep recession and housing market meltdown that began before Obama took office in January 2009. Many jobs that once belonged to Americans have been transferred overseas, a trend that took effect long before Obama's term began. While Bureau of Labor Statistics data showed 261,000 fewer non-farm jobs in the U.S. in August compared to when the president took office, there have been more than 4 million new non-farm jobs created since February 2010.

The ad relies in part on a July Washington Post story on an Ernst & Young study. The study concluded 2.1 million business owners would be subject to higher taxes if Congress adopts Obama's proposal to allow tax rates to increase in January for the nation's highest earners. But because this potential tax increase hasn't yet happened the ad doesn't support Wuebben's claim that Obama has already "increased our taxes." To the contrary, when Obama proposed his fiscal 2013 federal budget the administration stated that he already signed 17 small business tax cuts into law and proposed making permanent the elimination of capital gains taxes for "key small business investments."

Wuebben's statement about increased health care expenses relates to the health care insurance reforms approved by Obama and congressional Democrats. Without getting into the merits of health care coverage for employees who are now uninsured, it can be argued that the health care law will cost small businesses with more than 50 employees more money by forcing those companies to provide coverage for workers or pay a penalty. Businessweek reported in August that McDonald's expects the law will add $10,000 to $30,000 in costs to each of the company's franchises. Lastly, the ad supplements Schams' argument about regulations by citing a February Gallup poll of small business owners. But when asked why they're not looking for new employees, worries about new government regulations ranked only sixth on the list. Still, the argument about regulations has merit, despite a claim Obama made last year that his administration "is firmly committed to eliminating excessive and unjustified burdens on small businesses." FactCheck.org, which is run by the University of Pennsylvania's Annenberg Public Policy Center, reported last September that based on 2001 dollars, the cost of new government regulations under President George W. Bush was an estimated $1.3 billion to $3.4 billion from January 2001 through the end of fiscal 2002, his first years in office. Under Obama the cost was $8 billion to $16.5 billion from January 2009 through the end of fiscal 2010, his first years in office.

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