Wisconsin Politifact Couldn’t Fact Check Cheese
So there are these folks in Wisconsin who run a version of “Politifact,” complete with a “Truthometer.” Problem is, theirs needs to be recalibrated.
They subjected one of CFIF’s ads to their Truthometer. They decided we told a half-truth in calling the bailout for Puerto Rico a bailout, because no taxpayer funds would be used, which we never said, even though some of their “experts” experted that the negative effects on individual bondholders would, in fact, be pretty much what we said. Go figure.
If they had started by fact-checking themselves, they’d have been on more credible footing, since they identify CFIF several times as a “Super PAC” and once as a “political action committee.” CFIF is not now, nor has it ever been a Super PAC, ditto political action committee. The Truthometer’s worst designation – “Pants on Fire” – is too silly for grown-ups to use, so we’ll give them a big fat zero for that one.
The bill currently before Congress, H.R. 4900 or PROMESA, would bail out Puerto Rico. It would do so by empowering a financial oversight board to force “Super Chapter 9 bankruptcy” restructuring of Puerto Rico’s debt, which means that Puerto Rico could renege on paying its creditors all it owes them, even though a great deal of that debt is protected and prioritized by Puerto Rico’s constitution, which is how the bonds were sold as being really, really safe.
Since a large portion of that debt is held by individuals, they involuntarily will be paying for Puerto Rico’s bailout. Thus, what we actually said: “Retirement accounts crushed. A bailout on the backs of savers and seniors.” Or, as the so-called fact-checkers in Wisconsin put it: “And Duffy’s bill, experts tell us, almost certainly would mean lower returns for perhaps hundreds of thousands of Americans who invested in what long had been regarded as safe Puerto Rican bonds.”
Ultimately, our “sin” is adjudged as taking “things out of context.” Precisely how do we take “things out of context” when we specify the exact context we use?
After attacking CFIF, they attempt to defend the restructuring by writing: “With an Oversight Board managing a debt restructuring, savers likely will get a lower return than they expected. But without such a board, creditors would be fighting in court and the returns for individuals (sic) investors would likely be lower still.”
In actuality, creditors are already fighting in court, and given that one class of Puerto Rican bonds was issued under the “full faith and credit” of Puerto Rico’s constitution, the law is on their side. One reason for the urgency of restructuring (and along with the bill forcing a retroactive moratorium on litigation) is the fear that courts will indeed rule for the creditors.
One final note: The Wisconsin piece accuses CFIF of throwing around the word “bailout.” Here’s a term we will throw around: journalistically challenged. Fact check that.
Thomas Humber is founder of CFIF, and has been a recovering journalist for forty years.