Carly Fiorina, one of McCain's top surrogates and chief economic advisors, has repeatedly distorted Democratic proposals, used dishonest talking points criticizing Democrats, and bizarrely equated the mortgage crisis affecting millions of Americans to a "product recall." Fiorina also called outsourcing "right-shoring" after laying off 18,000 workers while running HP, and defends McCain's support for tax shelters overseas and tax cuts for the rich.
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In October 2003, the company announced that under then-CEO Fiorina's "restructuring" plan, the company would cut 17,900 jobs. [1]
Fiorina Called the Outsourcing of American Jobs 'Right Shoring.' As HP CEO, Fiorina made comments in Washington alongside Intel's CEO that "drew an unusually strong reaction from workers, who suggested the pair forfeit their own highly paid jobs to Chinese or Russian executives working for a quarter of their pay." Fiorina said that "there is no job that is America's God-given right anymore" and also said called what is generally referred to as 'offshoring,' the outsourcing of jobs to cheaper labor centers overseas, as "right-shoring." [2]
Fiorina Said U.S. Can't Be Distracted by 'Short Term Employment Concerns.' Promoting outsourcing, Fiorina said that "the country cannot afford to be distracted by short-term financial and employment concerns. 'The biggest barrier [to solutions] is our nation's attention span,' she said." [3]
Ms. Fiorina said, "Yes, but he's not proposed one single tax cut. Everything he's proposed is a tax increase, not a tax cut." [4]
Washington Post: Fiorina Wrong. "Carly Fiorina is wrong to claim that Obama has proposed no tax cuts and wants to raise 'every tax in the book.'" [5]
Carly Fiorina Repeated False Claim That "100 Million" Americans Pay Capital Gains Taxes. In an interview on the economy, Carly Fiorina, said that increasing the capital gains and dividends tax rates would affect "100 million Americans," mimicking a Republican National Committee ad and McCain's campaign trail rhetoric. [6]
REALITY: 14 Million Taxpayers, Mostly "Very Wealthy" Affected. The Tax Policy Center, a joint venture by the Urban Institute and the Brookings Institution has rebutted this false claim, noting that: "But most of these [100 million] shareholders hold assets in 401k plans, which are not subject to capital gains tax. In 2005, less than 14 million taxpayers realized taxable capital gains. And the vast majority of these gains are realized by very wealthy individuals -- almost 60 percent by individuals with income over $1,000,000." [7]
Fiorina Contradicted John McCain (Circa 2001) on Bush Tax Cuts. Challenged by MSNBC's David Schuster to explain the contradiction between McCain's 2001 opposition to the Bush tax cuts and his 2008 embrace of it, Fiorina said "Well, actually, no. He was against the Bush tax cuts in 2000 because he said they were not accompanied by spending restraint. He was right. President Bush oversaw a 70% increase in discretionary spending in the last seven years, the biggest increase in government sending since the great society. He now believes that to repeal the Bush tax cuts would be to levy the greatest tax cut on the American people." [8]
REALITY: McCain Said Distribution Of Tax Cuts Was Problem, Not Spending Restraints. On Meet the Press in 2002, John McCain said, "I voted against the tax cut, I voted against it because I didn't think that there was sufficient relief for working Americans." Senator Lieberman echoed the sentiment immediately after, "That's exactly right." In 2003, he repeated the concern, saying that "Most of the economists view this as--as primarily benefiting wealthier Americans" and noting that "The interesting thing to me is that most economists will tell you that it's the middle-income Americans that have been keeping the economy afloat buying cars, buying houses, consumer goods, not the wealthiest of America." [9]
Fiorina Tried To Cover For McCain's Support Of Corporate Tax Havens. George Stephanopoulos challenged Carly Fiorina on McCain's support for continuing tax havens overseas, while still advocating for cuts in the corporate tax rate. Mr. Stephanopoulos asked, "why is [McCain] for preserving the tax break for keeping profits overseas?" while still advocating for cutting the corporate rate. Fiorina responded, attacking Obama and maintaining that businesses actually do not benefit from tax deferments overseas, "Well describe for me the tax break that Obama feels is being maintained for companies who leave profits overseas. There is not an incentive today -- I can tell you as a CEO, you don't get a tax break for leaving profit overseas. What you get..." Stephanopoulos interrupted, "You get to defer the taxes on those profits as long as they stay overseas. That's what [Obama] wants to take away." Fiorina then said, "That's exactly the point. If the tax rate were lowered on businesses in this country, businesses would bring money back. The reason they cannot bring money back is because the tax rate is so onerous." The segment concluded with Stephanopoulous' final rebuttal, "Not if they can pay no taxes for leaving them overseas -- which is the way the law is right now." [10]
FLASHBACK: Fiorina Admitted That As CEO, She Kept "Billions" of Profits For HP By Parking Income Overseas. Carly Fiorina pointed out at an economic roundtable with John McCain that, as CEO of H-P, she purposefully parked "billions" of cash overseas to avoid paying taxes. She said, "The tax rate for us had a huge impact in terms of where we parked cash. And, of course, cash is important in a business, so when we looked at the tax rates here, and what it would cost to bring cash from overseas to here, we left billions of dollars of cash overseas, because of the differences in tax rates." [11]
HP Kept $14 Billion In Profit Overseas to Avoid Paying Taxes, Slashing Its Tax Rate. "By the end of its 2003 fiscal year, Hewlett-Packard Co. had 'indefinitely' deferred taxation on $14.4 billion of foreign earnings, according to SEC filings, a move that helped lower its effective tax rate from the statutory corporate income tax rate of 35 percent to 12 percent. [12]
In an interview on the economy, Carly Fiorina said, "Having looked at his economic plan and budget carefully I can tell you that John McCain will balance the budget by the end of the first term while at the same time getting our economy growing and cutting the taxes that he is proposing to cut." [13]
REALITY: McCain's Economic Plan Will Not Pay For His Proposed Spending Increases. Senator McCain's promises to cut "pork-barrel spending" in Washington is not enough to pay for his spending proposals, according to a review by the Wall Street Journal. According to the paper, merely "Eliminating earmarks wouldn't restore revenue lost by Sen. McCain's other propositions, including a litany of tax cuts. He plans to not raise taxes, but he also plans to increase the size of the military and institute health-care overhauls." [14]
Rhetoric: Fiorina Claimed McCain Wants To Help 4 Million Homeowners That Are "Truly Needy" Of Government Assistance. Speaking on a conference call addressing the sub-prime mortgage crisis, McCain's economic advisor Carly Fiorina suggested that McCain intended for the government to help 4 million "truly needy" Americans in threat of foreclosure. "John McCain was very clear on Tuesday in saying that he believed the role of government is to help the truly needy, and there are four million homeowners who are in need," Fiorina said. She defended his delayed response to the crisis, saying that McCain "wanted to see what the effect of the vast array of stimulus measures that have already been taken -- what the effect of those are before we continue to throw stuff out into the marketplace." [15]
REALITY: McCain Campaign's Program Will Help Only 400,000 Homeowners Maximum. The McCain campaign maintains that the HOME Plan will have a price tag of somewhere between $3 billion and $10 billion and assist somewhere between 200,000 and 400,000 homeowners. [16]
Homeowner Eligibility and Cost of McCain Plan Still Unclear. In a speech in which Senator McCain was expected to detail his plan to address the mortgage crisis, McCain came short of outlining precisely the costs and eligibility under his plan. The Boston Globe said that "still missing were details on exactly who would be eligible for help," under the HOME plan. [17]
McCain Leaves Behind At Least 1.5 Million "Undeserving" American Homeowners. Beyond those that might be helped by McCain's plan, "More than 1.5 million other homeowners -- presumably 'undeserving' -- are expected to face foreclosure this year." [18]
IRONY: Fiorina Received $650,000 In "Mortgage Assistance" from Hewlett-Packard. According to Proxy statements of Hewlett Packard, Fiorina received roughly $650,000 in "mortgage assistance" from the company from 1999-2004. [19]
Fiorina Twice Equated Mortgage Crisis to Toy Recalls. On a conference call with reporters Fiorina equated the mortgage crisis with a "product recall." Fiorina said, "'When a company has a defective product...those companies routinely bear the expense of a product recall,' she said. 'That is what John McCain is asking the mortgage industry to do.'" Days later, she made similar comments to Newsweek, saying "When the technology industry puts a product out that they believe might harm their customer, the company bears the burden of recalling that product. I think the mortgage companies and the banks should step to the plate and say, 'We have put products out there that have harmed our customers, either because we didn't explain them well, or because we pushed them into homes or mortgages that they couldn't afford.'" [20]
Carly Fiorina claimed that McCain "spoke loudly for four long years" against Secretary Donald Rumsfeld, calling Mr. Rumsfeld, according to Fiorina, "the worst secretary of defense in history." She continued, saying "that the prosecution of the war in Iraq was going badly," for four years and further claimed that the U.S. is "now executing a new strategy because of John McCain." [21]
Washington Post: McCain Never Publicly Called For Rumsfeld's Resignation. "In recent weeks, McCain has gone so far as to tell audiences that he was "the only one" who called for then-Defense Secretary Donald H. Rumsfeld's resignation. The only trick is he never did." [22]
2003: McCain Said Bush Led With "Clarity" And Did Not Exaggerate the Case for War. Senator McCain praised President Bush on his leadership on the Iraq war and said, "I think the president has led with great clarity and I think he's done a great job leading the country, don't you all?" Asked if he think the president exaggerated the case for war, McCain said, "I don't think so...I think that he made a strong case and I think that case has been verified with discovery of mass graves and the brutality of this incredible regime." [23]
2006: McCain "Confident" In Bush's Judgment on Troop Withdrawal. McCain said he was confident that U.S. President George W. Bush "will only withdraw troops based on conditions on the ground." [24]
2006: McCain Said That Iraq Was "On The Right Track" As The Country Moved Closer To Civil War. On March 1, 2006, McCain played down the increasing civil violence in Iraq. When Imus remarked that Iraq "already looks like a civil war," McCain responded, saying, "I keep trying to look at the bright side of this because we have to because the consequences of failure are catastrophic...I think, at least we're on the right track here." [25]
On the Joe Scarborough Show, Fiorina suggested that the war in Iraq had nothing to do with our current economic crisis. "There's no question that the Iraq War is costing us a lot of money," Fiorina replied. "But it's also the case that the housing crisis has nothing to do with the Iraq War. High fuel prices have nothing to do with the Iraq War, per se. And high food prices, in particular, have nothing to do with the Iraq War. ... It's not fair ... to try and make the Iraq War the cause of our current economic difficulties." [26]
Economic Advisor Fiorina Said McCain "Right Leader For Our Economy." McCain economic advisor Carly Fiorina dismissed talk of McCain's remark that he did not understand the economy well, saying it was "more a function of his natural humility" than an actual shortcoming. Fiorina said she signed on the advise McCain because "I think he's the right leader for our economy in the 21st century and I think the differences between him and his Democratic opponents are huge, both in terms of the philosophy of the role of government, as well as in terms of the specific programs that they would enact." She also said McCain recognized the limitations of government. "John McCain, by virtue, frankly, of his experience with the economy, understands that sometimes in a period of crisis we can overreact, we can do too much." [27]
McCain: I Never Really Understood Economics. McCain said, "The issue of economics is something that I've really never understood as well as I should. I understand the basics, the fundamentals, the vision, all that kind of stuff. But I would like to have someone I'm close to that really is a good strong economist. As long as Alan Greenspan is around I would certainly use him for advice and counsel." He followed up that comment by assuring listeners that "I've got Greenspan's book." [28]
McCain Criticized Severance Packages For CEOs Whose Extravagant Pay "Bear No Relation To The Success Of The Company Or The Wishes Of the Stockholders." During his speech before the National Small Business Summit, McCain said: "In times of hardship and distress, we should be more vigilant than ever in holding corporate abuses to account, as in the case of the housing market. Americans are right to be offended when the extravagant salaries and severance deals of CEOs, in some cases the very same CEOs who help bring on these market troubles, bear no relation to the success of the company or the wishes of the stockholders. Something is seriously wrong when the American people are left to bear the consequences of reckless corporate conduct while the offenders themselves are packed off with another $40 or $50 million for the road. If I'm elected president, I intend to see that wrongdoing of this kind is called to account by federal prosecutors. And under my reforms, all aspects of a CEOs pay, including any severance arrangements, must be approved by the shareholders, should be approved by the shareholders." [29]
Fiorina Received $42 Million Severance Package, Major Perjs From HP. After being "spectacularly" fired from Hewlett-Packard, Fiorina was awarded a severance package valued at $42 million, including stock options, which "disgusted" corporate governance advocates at the time. Federal filings at the time also showed that HP helped. Fiorina with her mortgage, relocation expenses, and taxes to the tune of $1.6 million between 1999 and 2003, as well as paying $50,000 in legal fees and providing personal use of a corporate jet worth $184,561. [30]