Fact-Checking the State of the Union

Filed in Gather Politics News Channel by on January 25, 2012 0 Comments

President Obama delivered his third State of the Union address since taking office. As outlined in Article Two, Section 3 of the U.S. Constitution, the purpose of the speech is to come before Congress and the American people to give the state of affairs of the country and his vision for the future. The president gave a lot of numbers and made a lot of statements during his speech and this article looks at the facts of some of those statements.


“On the day I took office, our auto industry was on the verge of collapse … and tonight, the American auto industry is back.”


This is a true statement. Ford, General Motors, and Chrysler are in better shape now in contrast to 2008. Ford is investing more money into manufacturing; General Motors knocked Toyota out of the top spot in sales, and Chrysler is the fast growing auto company in the U.S.

The Statement:

“Right now, Warren Buffet pays a lower tax rate than his secretary . . . Tax reform should follow the Buffett rule: If you make more than a million dollars a year, you should not pay less than 30 percent in taxes . . . asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense.”

The Facts:

According to the Wall Street Journal, the average tax rate for Warren Buffett’s office employees is 36% while his tax rate was 17.4% in 2010. This is an exception, not the rule. In a study by the Tax Policy Center, people earning over $1 million pay an average of 29.1% in federal taxes. People earning between $50,000 and $75,000 pay around 15%. The top 400 tax filers pay less than the $1 million average because of a loophole called carried interest, lowering their tax rate to an average of 18.11%.

The Statement:

“We need to change our tax code so that people like me, and an awful lot of members of Congress, pay our fair share of taxes . . . That’s how we’ll reduce our deficit. That’s an America built to last.”

The Facts:

Tax professionals do not agree with the president, nor do Alan Simpson and Erskine Bowles, the leaders of the debt commission. According to Simpson and Bowles, “We can’t simply cut or tax our way out of this problem. Bringing our debt under control will require tackling the growth of entitlements and reforming the tax code to promote economic growth and generate enough revenue to meet our commitments.”

The Statement:

“In the six months before I took office, we lost nearly four million jobs. And we lost another four million before our policies were in full effect. Those are the facts. But so are these. In the last 22 months, businesses have created more than three million jobs. Last year, they created the most jobs since 2005.”

The Facts:

The president is a little off in his numbers. On his claim that 4 million jobs were lost six months before he took office, the number is 3.56 million jobs lost. His statement on the loss of 4 million jobs before his policies took effect is true. His statement on more than 3 million (3.16 million) jobs created over 22 months is also true.

The Statement:

“That’s why I’m sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage, by refinancing at historically low-interest rates. No more red tape. No more runaround from the banks. A small fee on the largest financial institutions will ensure that it won’t add to the deficit, and will give banks that were rescued by taxpayers a chance to repay a deficit of trust.”

The Facts:

The no more red tape statement is incorrect. According to Yahoo! News, “Only those who signed a mortgage before May 31, 2009, and have not refinanced previously under the Home Affordable Refinance Program are eligible for the new scheme. The loan-to-value ratio has to be greater than 80 percent. Borrowers must also have good credit and must have kept up with their mortgage payments, with no late payment in the past six months and no more than one late payment in the past 12 months.” Experts also say the plan only benefits about 1 million homeowners; about 17% of those facing foreclosure on are delinquent.


The president was right on a couple of his statements and wrong on others. Like every other politician, the president crafts his words to paint the picture he wants people to see. It is always a good thing to check the facts on what politicians are saying to see if the two match up. In this state of the union speech, the president reached his base but it remains to be seen if he made any headway with independents.

(Photo Source: The Grio)

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