The Claim: Cain said Bloomberg News' analysis of his 9-9-9 tax plan is incorrect. "The reason it's incorrect is because they start with assumptions we don't make," he said.
The Background: Cain's proposal would eliminate the current U.S. tax code. Instead, he would tax sales transactions and gross income for individuals and businesses at 9 percent while eliminating levies on capital gains. He also would end the payroll tax that funds Social Security, and corporations wouldn't pay a tax on dividends. "It expands the base," he said. "When you expand the base, we can arrive at the lowest possible rate, which is 9-9-9. The difference between the 9-9-9 plan and the other plans that are being proposed is that they pivot off the existing tax code."
The Facts: Cain said his campaign has received an independent revenue analysis of his plan, though it hasn't been publicly released. He also hasn't detailed the specific assumptions his campaign is using. Working with the only data publicly available, Bloomberg News calculated that the 9-9-9 plan would have generated about $2 trillion if it were in place in 2010, compared with the $2.2 trillion the government collected that year. Cain's plan would generate $922.1 billion from the sales tax, $912 billion from the individual income tax and $127.7 billion from the tax on corporations. Cain said his plan would win passage in Congress. Congress has been reluctant to eliminate some of the most popular tax benefits currently in the code, such as the mortgage interest deduction, which survived the 1986 tax code overhaul.
Paul On Fed
The Claim: U.S. Representative Ron Paul of Texas said Federal Reserve Chairman Ben S. Bernanke has compounded the problem of inflation in the U.S., and that "he's inflating twice as fast as Greenspan was," referring to Bernanke's predecessor Alan Greenspan.
The Background: The Fed is charged by Congress with maintaining stable prices and maximum employment. The central bank has taken unprecedented steps to ease monetary policy, including lowering the benchmark interest rate to near zero and buying $2.3 trillion in housing and Treasury debt.
The Facts: The Labor Department's consumer price index, one of the most common inflation measures, has climbed 2.2 percent on average per year during Bernanke's 5 1/2 years in office, less than the average 3 percent rate during Greenspan's 18 1/2 years. The M2 money supply, which includes currency, bank deposits and money market mutual funds, rose 4.9 percent a year under Greenspan and has increased an average 6.4 percent annually under Bernanke. By other, less conventional measures of inflation, such as the price of gold in dollars or the amount of monetary base created by the Fed, there would be considerably higher rates of inflation under Bernanke's chairmanship.
Gingrich On Fed
The Claim: Newt Gingrich, former speaker of the House, said Bernanke has "in secret spent hundreds of billions of dollars" on bailouts of financial institutions and that nobody in the news media has demanded transparency from the central bank.
The Background: The Fed stretched its emergency powers during the financial panic of 2008 to rescue Bear Stearns Cos. and American International Group Inc. It also created lending tools to provide funds to banks, mutual funds and large corporations.
The Facts: The Fed made loans to financial institutions -- it didn't spend any money, and has said it has incurred no losses. While the central bank kept much of the information on the identity of borrowers confidential at the time, the Dodd- Frank Act and lawsuits by Bloomberg News and Fox News resulted in disclosure of the recipients in late 2010 and early 2011. The Fed has separately spent $2.3 trillion purchasing housing and government debt as part of monetary policy.
Huntsman On Taxes
The Claim: Former Utah Governor Jon Huntsman said "I created a flat tax in the state of Utah. It took that state to the number-one position in terms of job creation."
The Background: With the U.S. unemployment rate at 9.1 percent and jobs still 5 percent below where they were when the recession started in December 2007, job creation is arguably the most important domestic policy issue today. The three candidates with experience as governors, Romney, Perry and Huntsman, have been touting their credentials as job-generating state executives.
The Facts: The truth of Huntsman's claim depends on which data you use. Using the figures from employer payrolls, jobs in Utah grew 4.8 percent during Huntsman's tenure, from January 2005 to August 2009, which placed it fourth behind Wyoming, North Dakota and Texas. If you use the Labor Department's survey of households, employment grew 5.9 percent during the same period, placing Utah first. That ranking is eroded when you account for population growth, dropping Utah to 35th over the period.