Washington Post "fact checker" Glenn Kessler, noted water carrier for Republicans, is up to his old tricks. In today's column, he assigns Obama campaign spokesperson Stephanie Cutter one "pinocchio" for a statement she did not in fact make.
At issue is a statement Cutter made in a hard-hitting response web video released yesterday, in which she said in part:
Ironically, Mitt Romney knows better than anyone that business can’t always do it alone. When Bain & Company was on the verge of bankruptcy Romney himself negotiated a $10 million bailout with the FDIC.To assign the pinocchio, which Kessler defines as "selective shading of the facts[...] some omissions and exaggerations, but no outright falsehoods," Kessler needs to change the clear meaning of English words, and even fails to follow the very dictionary definition he himself cites.
Details on the other side...
Now, Cutter's statement is fairly clear. She clearly and specifically mentions Bain and Company, the parent consulting firm from which Romney spun off the venture capital firm Bain Capital, and she clearly and specifically mentions Romney's role in negotiating a $10 million bailout from the federal government. She does not state, nor does she imply, that Romney did anything illegal or improper, that taxpayer funds were involved, nor that Bain and Company was not entitled to the money it received. Rather, it is a simple statement that Romney's own documented business experience demonstrates, as she said in the quotation, that "business can't always do it alone."
Kessler begins by confirming the facts, citing The Real Romney -- the unauthorized candidate biography produced by a pair of Boston Globe investigative reporters. In the early 90s, after Romney had left Bain and Company, the firm fell into financial difficulties and through a complex set of events owed $38 million to Fleet Financial Services. This amount was insured by the Federal Deposit Insurance Corporation (FDIC), the Depression-era agency set up by FDR to avoid panicked bank failures like the ones that had caused the Great Depression.
Romney's negotiations with the FDIC resulted in the government agency paying $10 million of Bain and Company's debt to Fleet, and Bain paid the balance of what it owed. The FDIC, like its name implies, is a government-run insurance plan; banks are required to pay premiums to the FDIC coffers so that it can insure up to $250,000 of each individual depositor's accounts. The bailout to Bain was financed by the premiums that banks pay annually to the FDIC.
Kessler takes issue with the use of the term "bailout," noting that the FDIC itself characterizes transactions like the Bain/Fleet deal as a "loan restructuring." However, he quotes Webster's that a bailout provides "rescue from financial distress," and there is no doubt Bain was experiencing financial distress at the time Romney negotiated the deal with the FDIC, that the deal he cut was favorable to Bain at the expense of the FDIC, and that through the deal Bain received relief from its financial distress. The FDIC did what it was supposed to do, which is to bailout banks when they get in trouble. Kessler is cutting hairs here, and comes up empty.
Then Kessler gets into the most ridiculous part of his argument, that Cutter suggested either that Romney negotiated for taxpayer funds or that the Bain/Fleet bailout is somehow comparable to the TARP bailouts from 2008-2009. I keep re-reading her statement for those implications, and I honestly don't see them.
In any event, this discussion leads Kessler to his most laughable statement in the entire column:
one can get into a theoretical argument as to whether the FDIC’s money, once collected from banks, is actually then “government money.”Where's the theory, Glenn? The FDIC is "an independent agency of the federal government" and the money it disburses is collected through the taxing power of the federal government. Yes, it "receives no Congressional appropriations," but banks, Glenn, are required by law to pay the premiums that fund the FDIC's accounts. It is a government agency, and its funds are by definition "government funds." They are not part of the federal government's general fund, but they are definitely funds collected and controlled by an agency of the federal government.
Yes, Glenn, I am laughing at you. You make a fool of yourself.
Kessler justifies his pinocchio on the artificial bailout/restructuring distinction he himself invented, and that falls of its own accord. His tortured logic throughout simply cannot be sustained.
Glenn Kessler, water carrier in chief for today's GOP.
For your viewing pleasure, the entire Cutter video:
She's speaking truth to power. Spread it far and wide.