It was another quiet night on the fact-checking front at the Democratic National Convention. We found former presidential nominee Hillary Clinton cited a dubious study on billionaires profiting during the pandemic, and former Labor Secretary Hilda Solis went too far in describing an Obama-era effort on overtime pay.
Clinton’s Bogus $400 Billion Figure
Clinton got it wrong when she said that “billionaires got $400 billion richer” during the pandemic.
The figure is misleading. It comes from a May 21 study by two liberal advocacy groups, Americans for Tax Fairness and the Institute for Policy Studies. They estimated a $434 billion increase in the net worth of America’s more than 600 billionaires during what they erroneously called “the first two months of the coronavirus pandemic.” Actually, the pandemic started much earlier, costing those billionaires plenty.
The study picked March 18 as the pandemic’s starting date. But that’s five days after the White House proclaimed a national emergency because of the pandemic. And by that time the pandemic and its economic effects had already been raging for a long time. By March 12, over 1,600 Americans in 47 states were known to be infected according to the White House proclamation.
More to the point, investors started reacting weeks earlier to the pandemic’s global disruption of travel, tourism and manufacturing, sending stock values into a historic plunge. Between Feb. 19 and March 18 the S&P 500 had already lost over 29% of its value.
Other stock indexes showed similar plunges from the previous high for the year. The Dow Jones Industrial Average had lost nearly 33% of its value by March 18, and the NASDAQ composite index had lost nearly 29%.
The study claimed the American billionaires had “gained” 15% in net worth in the two months following March 18 — but that was simply regaining what had been lost in the weeks before.
It’s accurate to say that low-wage and less educated workers have suffered the worst pain of the pandemic — certainly more than those with white-collar jobs and substantial assets. But Clinton’s talking point grossly exaggerated that reality.
Federal labor laws require overtime pay (one-and-a-half times the regular pay) for time worked beyond 40 hours in a week. But there’s an exemption for “executive, administrative, professional and outside sales employees” if they’re paid over a certain amount, as a Labor Department fact sheet explains.
The Obama administration wanted to raise that income threshold — to $47,476 a year from $23,660 a year. That would have made an additional 4.2 million employees eligible for overtime pay, according to Labor Department estimates at the time.
But while the administration finalized such a rule in May 2016, and it was supposed to go into effect on Dec. 1, 2016, that didn’t happen. As we’ve explained before, 21 states sued the Labor Department, and in November 2016, a District Court judge found the rule was unlawful and blocked it from taking effect.
The Trump administration proposed a different rule on the matter, to raise the income cut-off to $35,308. That rule took effect on Jan. 1. The Labor Department estimates it would extend overtime pay to about 1.3 million workers this year.
Trump Tweets False Response to Harris Speech
While we didn’t find anything to fact-check from Sen. Kamala Harris’ speech accepting the Democratic nomination for vice president, President Donald Trump responded to her address with a false, all-caps tweet claiming that Harris once called Biden “a racist.”
BUT DIDN’T SHE CALL HIM A RACIST??? DIDN’T SHE SAY HE WAS INCOMPETENT???
— Donald J. Trump (@realDonaldTrump) August 20, 2020
As we have written, Harris did not call Biden a racist. In a June 27, 2019, Democratic debate, then-presidential candidate Harris criticized Biden’s comments about working with political opponents, including two senators who supported segregation, and Biden’s position on busing students to integrate schools. But she prefaced her remarks by specifically stating, “I do not believe you are a racist.”
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U.S. Department of Labor. “Fact Sheet #17A: Exemption for Executive, Administrative, Professional,
Computer & Outside Sales Employees Under the Fair Labor Standards Act (FLSA).” revised Sep 2019.
Federal Register, Vol. 81, No. 99. Rules and Regulations. Government Publishing Office. 23 May 2016.
Farley, Robert. “DNC Chair on Trump and Overtime Pay.” FactCheck.org. 28 Feb 2017.
Wiessner, Daniel and Iafolla, Robert. “Judge blocks Obama rule extending overtime pay to 4.2 million U.S. workers.” Reuters. 22 Nov 2016.
Federal Register. “Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees.” 27 Sept 2019.
Spencer, Saranac Hale. “Harris Hasn’t Called Biden a ‘Racist’ or a ‘Rapist’.” FactCheck.org. 14 Aug 2020.
Kiely, Eugene. “FactChecking Round Two of the Democratic Debate.” FactCheck.org. 28 Jun 2019.