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A Project of The Annenberg Public Policy Center

Meek Ad Heeds Fact-Checking?

Rep. Kendrick Meek of Florida is out with an ad that rewords an earlier attack on his Senate Democratic primary opponent, Jeff Greene. We had called Meek’s previous ad false for saying Warren Buffett personally criticized Greene. But Meek tweaked the claim in a new ad, and this time he gets pretty close to the truth.

Earlier, Meek’s ads falsely pushed the idea that Warren Buffett said that Greene’s Wall Street dealings were "financial weapons of mass destruction." As we said before, Buffett, the CEO of Berkshire Hathaway, didn’t say that about Greene; he was talking about derivatives in general, years before Greene’s dealings.

Now, Meek’s ad says: "Warren Buffett called credit default swaps ‘financial weapons of mass destruction.’ " Then, it ads: "Greene was ‘the first individual’ to use" credit default swaps.

Actually, Buffett said that in 2003 about derivatives and didn’t use the words "credit default swaps," which are a type of derivative. A CDS is insurance on credit, such as a mortgage, and Greene became a billionaire by trading these swaps as the subprime mortgage market imploded. However, Buffett’s comment turned out to be quite prescient, and the type of derivative that caused major damage at institutions including AIG was indeed the credit default swap.

Meek’s camp points to a 2008 interview of Buffett on "The Charlie Rose Show," in which Buffett referred to his comment about derivatives and said, "they destroyed AIG." The company got into dire financial straits by selling credit default swaps and had to pay out much more than it bargained for when homeowners defaulted on subprime mortgages. Greene, on the other hand, who is believed to be the first to trade CDS, made hundreds of millions as foreclosures piled up.

A Few Minor Points

Meek’s ad says he was endorsed by "every major newspaper," as well as Presidents Obama and Clinton, state teachers and police. True enough. Meek has been endorsed by nine major papers in the state, as well as the presidents and groups mentioned. However, a viewer might get the impression that no paper in the state has endorsed Greene, and that would be incorrect. The Tallahassee Democrat endorsed him, as did the Bradenton Herald.

The ad goes on, with the announcer saying: "And Jeff Greene? A flat-out liar." On screen the ad cites a column in the Orlando Sentinel. That quote is correct — Sentinel columnist Mike Thomas did say that about Greene and his shifting stories about a yacht trip to Cuba.

The ad ends by attributing a callous-sounding quote to Greene. The quote is accurate. Greene said: "All I care about is that I get my money," the ad claims. Greene said that about a real estate deal in which he sold condos to a man who has been indicted on conspiracy and money laundering charges. The quote is from a St Petersburg Times article that said Greene "wasn’t just a spectator to the housing collapse" but was "party to precisely the kind of deal that decimated the market."