Here's some potentially VERY good economic news that was lost amid the weekend news flurry.  Those…
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Some Potentially VERY Good Economic News

Here's some potentially VERY good economic news that was lost amid the weekend news flurry.  Those with "skin in the game," and who likely possess the best perspective, are betting heavily on an upturn, as highlighted by Friday's Wall Street Journal:

Corporate insiders are buying stock in their own companies at a pact not seen in years, a sign they are betting on a rebound after a coronavirus-induced rout.  More than 2,800 executives and directors have purchased nearly $1.19 billion in company stock since the beginning of March.  That's the third-highest level on both an individual and dollar basis since 1988, according to the Washington Service, which provides data analytics about trading activity by insiders."

Here's why that's important:

Because insiders typically know the…[more]

March 30, 2020 • 11:02 am

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Washington Post "Fact Checker" Reporter to Puerto Rico Retirees and Bondholders: Let Them Eat Social Security Cake Print
By CFIF Staff
Friday, May 13 2016
In an email exchange, the 'Fact Checker' who authored the piece, Michelle Ye Hee Lee, had the audacity to suggest a 'let them eat cake' solution since the retirees hit by PROMESA would still have their Social Security.

It's bad enough that The Washington Post's notoriously biased "Fact Checker" labels a Center for Individual Freedom (CFIF) television advertisement opposing a Puerto Rico bailout by Congress as "half true," even after acknowledging that we told the whole truth. 

But just wait until you hear what Michelle Ye Hee Lee, one of the Post's "Fact Checker" reporters, asked CFIF in an email to us. 

First, a little bit of background. 

CFIF has been a vocal opponent of proposed Congressional legislation entitled the "Puerto Rico Oversight, Management and Economic Stability Act" (H.R. 4900), commonly known as "PROMESA."  We are joined in our opposition by conservative state governors, Members of Congress, policy experts and other prominent conservative organizations, and with good reason.  Namely, certain provisions within PROMESA violate the principles of rule of law, property rights, moral hazard and governmental fiscal responsibility.  On that basis, CFIF has engaged in television advertising as part of a comprehensive education campaign about Puerto Rico's underlying debt crisis, the fiscal recklessness that caused it and how PROMESA constitutes a "Super Chapter 9" bailout on the backs of American savers and retirement investors (including many in Puerto Rico itself). 

So this week, The Washington Post decided to put its "Fact Checker," which is politically biased and blatantly subjective while masquerading as objective, on the case.  Specifically, their hit piece took issue with a CFIF ad that features a Puerto Rican retiree named Teresa Garcia, and our statement that, "Small investors like Teresa own 80% of Puerto Rico's debt...  This is a bailout of Puerto Rico on the backs of savers like Teresa.  Congress wants to bail out Puerto Rico with Teresa's retirement savings." 

The Post's "Fact Checker" proceeds to acknowledge that our 80% citation is supported by a report to which we directed them in Puerto Rico's El Nuevo Dia, and that Ms. Garcia's story checks out: 

"Teresa Garcia is a Puerto Rican resident who in 2005 invested about $500,000 of her retirement savings in Puerto Rican bonds, to complement her Social Security retirement benefits.  Her broker told her that investing in general obligation bonds, issued by the government and constitutionally protected, would allow her to take advantage of a tax exemption on capital gains."  (emphasis added) 

Regarding CFIF's claim that PROMESA constitutes a "bailout on the backs of savers like Teresa," an expert featured in the "Fact Checker" piece not only confirmed that to be true, but estimated that the government could impose losses of 60% on individuals like Teresa if the legislation passes. 

"If the bill passes and Puerto Rico restructures its debt, individual creditors likely will get a lower return on their investment.  Someone who has a general obligation bond and interest payment due in June for $500 might end up getting $200.  The remaining $300 would go toward basic services for the island, said Frank Shafroth, who researches municipal bankruptcies and is director of George Mason University's Center for State and Local Government Leadership." 

But then look what this so-called "Fact Checker" does. 

In its conclusion entitled "The Pinocchio Test," the Post even admits a second time that, "There are indeed people like Teresa Garcia, who bought municipal bonds - and they would almost certainly be paid less than they are owed" should PROMESA become law.  It also admits that CFIF never once suggested that the Puerto Rico bailout contemplated by PROMESA "would be funded directly by American taxpayers." 

In other words, "Fact Checker" admits that the claims made in CFIF's ad are correct, and that Ms. Garcia's testimony is legitimate.  Yet they employ their own subjectivity and political bias to assign the ad "Two Pinocchios," which is their method of labeling it "half true."  In granting that designation, the Post argues that, "Ultimately, the ad misleads the public to make it seem as if the legislation would only hurt individual bondholders," even though they repeatedly cited our 80% statistic throughout their piece!  This "Fact Checker" finishes with its own editorial comment, which is anything but objective or "fact":  "Moreover, delaying a restructuring - or resorting to a default - likely leads to worse circumstances for ordinary bondholders." 

Talk about Pinocchios. 

But here's the kicker.  In an email exchange, the "Fact Checker" who authored the piece, Michelle Ye Hee Lee, had the audacity to suggest a "let them eat cake" solution since the retirees hit by PROMESA would still have their Social Security.  Here are her exact words: 

"How dependent are PR seniors's [sic] retirement funds on these bonds?  Do they not get Social Security?  Is it possible that even if they don't get the full investment back on the bonds, they still have other retirement savings like Social Security?" 

Let's answer Ms. Lee's question by asking a question of our own.  Ms. Lee, if legislation in Congress raided your 401(k) or other private retirement investment funds to bail out profligate politicians for their years of fiscal recklessness, would you be fine with that since you'd still receive your Social Security someday (assuming it still exists then)?  Somehow, one suspects you wouldn't. 

For their transparently biased piece, The Washington Post's "Fact Checker" earns nothing short of their own dreaded Four Pinocchios. 

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—Jonathan Turley, George Washington University Shapiro Professor of Public Interest Law
— Jonathan Turley, George Washington University Shapiro Professor of Public Interest Law
 
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