A Project of The Annenberg Public Policy Center

Stimulus Jobs in China?

Republicans falsely claim that $2 billion went to employ Chinese workers.


Summary

In a bit of political payback, several Republicans are running false or misleading TV ads accusing their opponents of shipping jobs to China — a charge that Democrats have frequently and often incorrectly leveled against Republicans.

  • Rep. Lee Terry of Nebraska says that under President Barack Obama’s stimulus package "China gets $2 billion to build windmills" for U.S. wind farms, citing the Investigative Reporting Workshop at American University. But Russ Choma, author of that report, says Chinese-owned companies received $2.6 million and manufactured three of the 4,232 wind turbines under the stimulus program.
  • Republican Austin Scott says Georgia Rep. Jim Marshall "sent nearly $2 billion overseas to create jobs in China." It is true that foreign-owned companies have received $2.4 billion in grants to develop wind farms in the U.S. But Choma said "more money went to creating jobs in the U.S. and Europe."

At least four other Republicans have recently aired ads that correctly say stimulus money has gone to create jobs in China — without saying how many — but then incorrectly go on to say that no jobs have been created in their district or state.

The Congressional Budget Office says the stimulus — which is now estimated to cost taxpayers $814 billion by 2019 — increased the number of people employed in the U.S. by between 1.4 million and 3.3 million through June. That includes jobs that were created in the districts of all four Republican candidates cited in our analysis below.

Analysis

Bogus Democratic claims about Republicans who pledged to protect tax loopholes for companies that ship jobs overseas have been a staple of this campaign. But now the imported shoe is on the other foot.

Republicans have seized on a series of investigative reports that found stimulus money for the construction of wind farms in the U.S. has gone to foreign-based companies.

Did You Say Billions . . . or Millions?

In an ad called "Final Contrast," which first aired Oct. 24, Rep. Lee Terry of Nebraska criticizes his Democratic challenger, Tom White, for supporting the stimulus. (White, of course, didn’t vote for the stimulus, since he wasn’t in Congress. That’s a different issue.) The ad says: "White supported Pelosi’s $800 billion stimulus plan. Unemployment goes up, debt goes up, and China gets $2 billion to build windmills."

The truth is that China got a fraction of the grant money that was awarded to foreign-based companies.

[TET ]

Terry for Congress TV Ad: "Final Contrast"

Announcer: Nancy Pelosi and Tom White believe bigger government is the answer.White supported Pelosi’s $800 billion stimulus plan. Unemployment goes up, debt goes up, and China gets $2 billion to build windmills. White supported Obamacare, which raises taxes, increases cost, and reduces care. Their ideas failed. Don’t let them make it worse. Vote No to Nancy Pelosi and Tom White. 

[/TET]

The ad doesn’t provide a source for its claim about China, so we asked the campaign where it got the information. Terry’s campaign manager, Dave Boomer, provided a link to a Feb. 8, 2010 story by Russ Choma at the American University’s Investigative Reporting Workshop. But the story doesn’t support the claim. 

The story says a total of $2.1 billion in clean-energy grants had been awarded to that point and $1.6 billion, or 79 percent, of it went to foreign-based companies for wind energy projects in the U.S. None of it went to Chinese-based companies.

We interviewed Choma and he provided updated figures. As of Sept. 8, the total amount in wind-energy grants was $4.4 million and 45.8 percent of that went to U.S.-based companies, he said. Chinese-based companies received just $2.6 million, or 0.1 percent of the total.

Choma also tracks the companies that manufacture the wind turbines for the stimulus-funded U.S. wind farms. He said three, or 0.1 percent, of the 4,232 wind turbines completed so far under the stimulus program were manufactured by Chinese-based companies.

Choma’s February story was his second on the topic. His first story appeared a year ago, Oct. 29, 2009. It found that 84 percent of the $1 billion in clean-energy grants that had been awarded up until then had gone to foreign-based companies, but again none of it to Chinese companies. On the day his story was posted on the workshop’s website, a consortium of U.S.-Chinese companies announced plans for a $1.5 billion wind farm in Texas. That triggered a congressional backlash because the group planned to seek $450 million in stimulus funds. The consortium, however, has yet to apply for any stimulus funds, and Choma said it’s uncertain if the project will proceed.  

That’s as close as China has come to getting a major piece of the stimulus money.

OK, China Didn’t Get Billions. But Jobs?

Republican Austin Scott, who is challenging Democratic Rep. Jim Marshall of Georgia, also ran a commercial that uses the bogus $2 billion number — with a focus this time on jobs. Scott’s ad, which aired from Oct. 7-11, says Marshall voted for the stimulus (which is true). "He sent nearly two billion tax dollars overseas to create jobs in China," the ad says. That’s an exaggeration.

[TET ]

Austin Scott for Congress TV Ad: "Tired"

Austin Scott: I’m Austin Scott. I approve this message because you deserve to hear exactly where I stand, directly from me. I’ll fight to cut taxes, cut the debt and protect our jobs and Jim Marshall knows it. There is a clear difference between us on spending and jobs. I opposed the failed Obama-Pelosi stimulus bill. Jim Marshall voted for it. He sent nearly two billion tax dollars overseas to create jobs in China. I’ll fight for American jobs.

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Scott’s campaign cited a Sept. 9, 2010 story in the Washington Times that referenced Choma’s reporting. That story said "as much as 80 percent of some green programs, including $2.3 billion of manufacturing tax credits, went to foreign firms that employed workers primarily in countries including China, South Korea and Spain, rather than in the United States."

As we know from Choma’s exhaustive research, it is true that foreign-owned companies have received $2.4 billion in grants to build wind farms in the U.S. Choma gives this breakdown: Spain, $1.1 billion; Germany, $474.4 million; Portugal, $333 million; Australia, $178 million; Japan, $130.5 million; Italy, $84.2 million; France, $69.5 million; United Kingdom, $42.2 million; China, $2.6 million.

But it is not known how many jobs may have been created in China as a result of the stimulus funding of wind energy projects.

Choma said wind turbines have 8,000 components and he found proof that some of them were manufactured in China and other countries. His Feb. 8 story said that U.S. Customs records showed "turbine components are being imported from China, Germany, Spain and Brazil." But Choma said there is no way to know how many jobs this created in China. He wrote:

Choma, Feb. 8, 2010: Trying to divine whose pocket the stimulus money eventually ends up in is difficult because of the complex nature of wind turbines. Even the companies that have significant turbine production facilities in the United States rely on foreign sources for many of the 8,000 components.

In a blog post on Sept. 27, Choma wrote: "…we can’t say for sure how much of this stimulus money went to create jobs in China. Some money definitely did, but it is safe to say more money went to creating jobs in the U.S. and Europe."

The U.S. Department of Energy doesn’t know how many jobs may have been created in China as a result of the stimulus funding for U.S. wind farms. It did, however, point us to a Lawrence Berkeley National Laboratory report issued May 11 that estimated the renewable energy program will generate about 50,000 short-term jobs and nearly 4,000 long-term jobs in the U.S.

Jobs for China, But Not Us?

The jobs-to-China theme runs through many Republican ads, including four recent TV ads that claim the stimulus created jobs in China — but not in Tennessee, or Virginia, or the state of Washington, or Toledo, Ohio. That’s false. They are correct to say that the stimulus law created jobs for Chinese workers — even though we don’t know many — but wrong to say it did not create jobs here at home.

[TET ]

Iott for Congress TV Ad: "Where are the jobs?"

Announcer: Marcy Kaptur, after your wasteful stimulus, where are the jobs? Don’t worry, we found them — across the globe — in China. That’s right, the Washington Times reports Marcy Kaptur wasted our tax dollars to create jobs for the Chinese, not Toledo. Marcy Kaptur had her chance. We need an American job creator. Rich Iott, a man of ethics and integrity. He still believes in the American worker.

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In an ad called "Where are the jobs? — which first aired Oct. 19 — Republican challenger Rich Iott in Ohio’s 9th Congressional District says Rep. "Marcy Kaptur wasted our tax dollars to create jobs for the Chinese — not Toledo." But the Recovery Accountability and Transparency Board reports that in Kaptur’s district  354 jobs were directly funded by stimulus funds in the most recent quarterly reporting period alone, from April 1 through June 30. 

As we have reported, the recovery board’s accounting of jobs funded by stimulus money was riddled with problems at the outset and should still be viewed with some skepticism. The tally is based on reports filed by prime recipients of stimulus funds. But there shouldn’t be any question that some jobs were created in Toledo.

[TET ]

Stephen Fincher for Congress TV Ad: "Garbage."

Announcer: What do independent sources say about Roy Herron’s false ads? They’re garbage. False and misleading. But Herron supports the Obama-Pelosi stimulus. A trillion dollars of our tax money, squandered. Even tax credits to build windmills in China. No wonder Roy Herron is falsely attacking his opponent. False ads, wasteful spending, jobs for China, but not Tennessee.

Stephen Fincher: I’m Stephen Fincher and I approve this message because this is no time for politicians.

[/TET]

In Tennessee’s 8th Congressional District, Republican Stephen Fincher and Democrat Roy Herron are battling to replace retiring Democratic Rep. John Tanner.

Like Tim White in Nebraska, Herron wasn’t in Congress when the stimulus passed and he didn’t vote for the stimulus. But Fincher is running an ad, which first aired Oct. 14, that says White "supports the Obama-Pelosi stimulus" that "squandered" tax money on "tax credits to build windmills — in China." A "Made in China" stamp is slapped on the screen for emphasis. "No wonder Roy Herron is falsely attacking his opponent," the ad says. "False ads, wasteful spending, jobs for China, but not Tennessee."

No jobs for Tennessee? Really? The recovery board website shows that the stimulus funded 15,391 jobs in Tennessee in the most recent three-month reporting period, from April 1 through June 30, including 413 jobs in the 8th district.

[TET ]

Koster for Congress and NRCC’s TV Ad: "Unbelievable"

Narrator: Unbelievable. The decade Rick Larsen has been in Congress unemployment’s more than doubled. Yet he attacks John Koster who has never outsourced a single American job. Rick Larsen voted for Nancy Pelosi’s wasteful trillion dollar stimulus- helping to create jobs in China. Washington families struggle to find work, but Larsen creates jobs for the Chinese- not us. Rick Larsen, after a decade of economic failure, time for a new congressman.

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In Washington’s 2nd Congressional District, Republican John Koster and the National Republican Campaign Committee aired a TV ad called "Unbelievable" that targets Rep. Rick Larsen. The ad, which first aired Oct. 14, says: "Washington families struggle to find work, but Larsen creates jobs for the Chinese — not us."

That is indeed unbelievable. The recovery board reports that the stimulus funded 682 jobs in the 2nd Congressional district from April 1 to June 30. That includes, for example, jobs paid for by a $15.8 million grant to update Snohomish County’s electric grid.


[TET ]

NRCC TV Ad: "Baloney"

NRCC announcer: NRCC announcer: Virginia known for great hams. Glenn Nye? For baloney! Seen this?

Nye announcer: And going against his own party, he voted against the Wall Street bailout

NRCC announcer: But FactCheck.org calls it, ‘baloney.’ Nye wasn’t even in Congress then. Truth is Nye does vote with his party. Like the liberal Nye/Pelosi/Obama "stimulus" that spent over a billion to create jobs in places like China, not Virginia. Glenn Nye. Not the truth, baloney.

[/TET]

The NRCC’s ad "Baloney," which first aired Oct. 15, makes a similar accusation about Rep. Glenn Nye in Virginia’s 2nd Congressional District. The ad states that Nye voted for the stimulus bill, which "spent over a billion to create jobs in places like China, not Virginia." There were 26,889 jobs funded in Virginia from April 1 through June 30, including 246 jobs in Nye’s district. 

— by Eugene Kiely, with Lara Seligman, Lauren Hitt and Melissa Siegel

Sources

Goldman, Joshua and Eugene Kiely. "A New Twist on an Old Tax Attack." FactCheck.org 8 Oct 2010.

Choma, Russ. "Renewable energy money still going abroad, despite criticism from Congress." Investigative Reporting Workshop. 8 Feb 2010.

Choma, Russ. "Overseas firms collecting most of green energy money." Investigative Reporting Workshop. 29 Oct 2009.

Choma, Russ. "Workshop’s wind stories kicking up political dust." Investigative Reporting Workshop. 27 Sep 2010. 

Choma, Russ, reporter, Investigative Reporting Workshop. Interview with FactCheck.org. 28 Oct 2010.

Choma, Russ, reporter, Investigative Reporting Workshop. E-mail sent to FactCheck.org. 28 Oct 2010.

Boomer, Dave, campaign manager, Lee Terry for Congress. E-mail sent to FactCheck.org. 28 Oct 2010.

Ray, Sam, Austin for Congress. E-mail sent to FactCheck.org. 28 Oct 2010.

Rudolf, John Collins. "China-U.S. Group Plans to Build Texas Wind Farm." New York Times. 29 Oct 2009.

Mueller, Stephanie, spokeswoman, U.S. Department of Energy. 27 Oct 2009.

U.S. House. H.R. 1, roll call vote #70. 13 Feb 2009.

Hill, Patrice. "‘Green’ jobs no longer golden in stimulus." Washington Times. 9 Feb 2009.

"Berkeley Lab’s Preliminary Evaluation of Recovery Act Grant Program Finds Positive Effects on Renewable Energy Capacity and Jobs." Press release. Lawrence Berkeley National Laboratory. 11 May 2010.

"Ohio Funding by District (Apr 1 – June 30, 2010)" Recovery Accountability and Transparency Board. Accessed 29 Oct 2010.

"State/Territory Totals by Award Type." Recovery Accountability and Transparency Board. Accessed 29 Oct 2010.

"Tennessee Funding by District (Apr 1 – June 30, 2010)." Recovery Accountability and Transparency Board. Accessed 29 Oct 2010.

"Washington Funding by District (Apr 1 – June 30, 2010)." Recovery Accountability and Transparency Board. Accessed 29 Oct 2010.

"Grants Award Summary: Public Utility District 1 of Snohomish County." Recovery Accountability and Transparency Board. Accessed 29 Oct 2010.

"Virginia Funding by District (Apr 1 – June 30, 2010)." Recovery Accountability and Transparency Board. Accessed 29 Oct 2010.