Same Old Claims in Another Language

Si tienes un negocio pequeño o trabajas para uno, sabes que más impuestos significa menos empleos, menos dinero en nuestros bolsillos y menos oportunidades. Y quién va a contratar con tantos impuestos! Obama y los liberales del Congreso. Un riesgo para los empleos y los negocios pequeños.

John McCain: I'm John McCain and I approve this message.

Announcer (translated): Experts predict that Obama and Congressional liberals' new taxes and health care mandate will kill jobs. If you own a small business or work for one, you know that more taxes means less jobs, less money in our pockets, and less opportunities. Who's going to hire with so many taxes! Obama and Congressional liberals. Too risky for jobs and small business.

McCain: I'm John McCain and I approve this message.

Small-Business Distortions
A McCain-Palin ad released this month, titled "Riesgo" ("Risk"), implies in Spanish that Obama's plans would punish small businesses with taxes and a "health care mandate." The campaign has been pushing this line of attack ever since "Joe the Plumber" – who stands to get a tax cut under Obama's plan – asked Obama about raising taxes on those earning more than $250,000, a sum Joe hopes to make one day. (The ad was to air in Colorado, Florida, Nevada and New Mexico.)

First, Obama's health care plan would not mandate that "small businesses" provide coverage for their employees, no matter how many times McCain insists on saying this. Obama's plan would require "large employers" to either offer coverage or contribute toward employees' health care, or pay into a national plan. It quite clearly says: "Small businesses will be exempt from this requirement."

The campaign's support for this ad actually does a bang-up job of debunking its own claims. The back-up says Obama hasn't said "how much the fine will be for small businesses under his health care plan," but as proof cites just one Wall Street Journal article, which specifically debunks this McCain camp talking point.

Wall Street Journal (Oct. 16, 2008): The Arizona Republican has repeatedly said that his rival would fine small employers that don't offer insurance. In fact, the mandate and the fine only would apply to large employers.

It's true that Obama hasn't specified what larger businesses would have to pay for failing to provide health care, nor has he said what his plan would consider a "small business." In August, campaign economic adviser Jason Furman told ABC News that the number of employees "would almost certainly be higher than ten," when asked whether the Tax Policy Center analysis of the candidates' plans was correct in assuming businesses with fewer than 10 employees would be exempt. But Furman said the campaign hasn't given a specific number. It's worth noting, as the Journal does, that Obama's plan also includes a tax credit of up to 50 percent of the premium costs for small businesses (however those are defined) who choose to offer coverage to their employees.

As for taxes, the McCain campaign support for the ad makes clear that Obama would "roll back the Bush tax cuts for those making over $250,000" a year. (That's the figure for couples; individuals making over $200,000 a year would also revert to paying pre-Bush-tax-cut rates.) But the ad implies that "if you own a small business" you'll get hit with "more taxes." And if you work for one, your job's at risk. "Who's going to hire with so many taxes!" the ad claims. Not every small-business owner, of course, makes $200,000 or $250,000 a year, enough to face "more taxes" under Obama's plan. In fact, not that many do.

As we said back in June when the McCain camp made a similar claim, "the overwhelming majority of those small-business owners would see no increase, because they earn too little to be affected." The Urban-Brookings Tax Policy Center projects that 663,608 taxpayers who report business income (or losses) on their tax returns in 2009 will fall into the top two brackets. The number who are actually "small businesses" would be less than that, since many others report business income on their returns –  such as lawyers with partnership distributions, those with outside consultancy or freelance work, or those with book royalties. (The top two brackets also include some individuals who make less than the amount Obama set as his tax thresholds.)