Fact checking the 2013 State of the Union speech

A State of the Union address is often difficult to fact-check, no matter who is president. The speech is a product of many hands and is carefully vetted, so major errors of fact are relatively rare. But State of the Union addresses often are very political speeches, an argument for the president’s policies, so context is sometimes missing.

Here is a guide through some of President Obama’s more fact-challenged claims, in the order in which he made them. As is our practice with live events, we do not award Pinocchio rankings, which are reserved for complete columns.

“After years of grueling recession, our businesses have created over 6 million new jobs.”

The president is cherry-picking a number that puts the improvement in the economy in the best possible light. The low point in jobs was reached in February 2010, and there has indeed been a gain of about 6 million jobs since then, according to Bureau of Labor Statistics data. But the data also show that since the start of his presidency, about 1.2 million jobs have been created — and the number of jobs in the economy is about 3.2 million lower than when the recession began in December 2007.

“We buy … less foreign oil than we have in 20 [years].”

This claim lacks context. The Energy Department has cited a host of reasons why foreign oil imports have declined, noting the main reason was “a significant contraction in consumption” because of the poor economy and changes in efficiency that began “two years before the 2008 crisis” — in other words, before Obama took office.

“Over the last few years, both parties have worked together to reduce the deficit by more than $2.5 trillion — mostly through spending cuts, but also by raising tax rates on the wealthiest 1 percent of Americans. As a result, we are more than halfway towards the goal of $4 trillion in deficit reduction that economists say we need to stabilize our finances.”

This is debatable, depending on how you do the numbers. Many budget analysts measure the decline in deficits from August 2010 — which was a high point for spending. (Obama’s $2.5 trillion figure adds in interest savings from reducing anticipated debts, which is different from actually cutting spending or adding revenue.)
 
But agreement starts to break down quickly about the $4 trillion goal, which translates to just $1.5 trillion in additional work. The Committee for a Responsible Federal Budget, in a recent report, argued that $2.7 trillion in deficit reduction over 10 years has been enacted so far, including tax increases, but that another $2.4 trillion was needed to reduce the ratio of debt to gross domestic product to 70 percent. The left-leaning Center on Budget and Policy Priorities argues instead that $1.5 trillion is needed to achieve a 73 percent ratio. Those numbers could have real-world consequences for government programs.

“On Medicare, I’m prepared to enact reforms that will achieve the same amount of health care savings by the beginning of the next decade as the reforms proposed by the bipartisan Simpson-Bowles commission.”

This carefully crafted phrase recently earned the president a prized Geppetto Checkmark. Obama wants us to compare the savings in 2022. Granted, that would be six years after Obama’s second term ends. But administration officials argue that changes in health-care policies take time to achieve budget savings, and that the right mix can produce greater savings in the long run.

Using Congressional Budget Office estimates of the president’s budget, we see that over 10 years, Obama’s proposals would achieve $337 billion from 2013 to 2022, compared to $483 billion for Bowles-Simpson in the same time period. (Bowles-Simpson, or more accurately the National Commission on Fiscal Responsibility and Reform, is considered by many in Washington to be the model for a bipartisan approach for deficit reduction.)

However, in 2022, both would achieve exactly the same amount of savings — $68 billion.

Administration officials say they believe their proposals would achieve greater savings than Bowles-Simpson after 2022, which would be consistent with the increase in savings toward the end of the first 10-year budget window.

“Every dollar we invested to map the human genome returned $140 to our economy.”

This interesting factoid comes from this 2011 study, which we have not had a chance to fully study. But about two-thirds of the calculated impact comes from “indirect impacts" and “induced impacts” (see page ES-3) — which is always the subject of debate and conjecture.

“After shedding jobs for more than 10 years, our manufacturers have added about 500,000 jobs over the past three.”

Obama again is cherry-picking a jobs number. The low point for manufacturing jobs was reached in January 2010, and so there has been a gain of 500,000 jobs since then. But BLS data show that the number of manufacturing jobs is still 600,000 fewer than when Obama took office in the depths of the recession — and 1.8 million fewer than when the recession began in December 2007.
Moreover, growth in manufacturing jobs has essentially stalled since last July.

“I ask this Congress to declare that women should earn a living equal to their efforts, and finally pass the Paycheck Fairness Act this year.”

There is clearly a wage gap, but differences in the life choices of men and women — such as women tending to leave the workforce when they have children — make it difficult to make simple comparisons.

The administration’s back-up document for this statement asserted that “on average women generally make 23 cents on the dollar less than men.” But the White House is using a figure (annual wages, from the Census Bureau) that makes the disparity appear the greatest. The Bureau of Labor Statistics, for instance, shows that the gap is 19 cents when looking at weekly wages. The gap is even smaller when you look at hourly wages — it is 14 cents — but then not every wage earner is paid on an hourly basis, so that statistic excludes salaried workers

In other words, since women in general work fewer hours than men in a year, the statistics used by the White House may be less reliable for examining the key focus of the legislation — wage discrimination. Weekly wages is more of an apples-to-apples comparison, but it does not include as many income categories.
Economists at the Federal Reserve Bank of St. Louis surveyed economic literature and concluded that “research suggests that the actual gender wage gap (when female workers are compared with male workers who have similar [employment] characteristics) is much lower than the raw wage gap.” They cited one survey, prepared for the Labor Department, which concluded that when such differences are accounted for, much of the hourly wage gap dwindled, to about 5 cents on the dollar.

By Glenn Kessle, in JWR