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updated: 10/22/2012 2:36 PM

Fact-checking the ads in the 11th Congressional District race

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  • Republican Judy Biggert is running against Democrat Bill Foster in the 11th Congressional District race.

      Republican Judy Biggert is running against Democrat Bill Foster in the 11th Congressional District race.

  • Video: Watch Bill Foster's China ad

 
 

By now you've seen the competing attack ads involving trade with China that both Republican Judy Biggert and Democrat Bill Foster are running in the 11th Congressional District contest.

A fact check show both assaults lack the necessary background information for voters to properly interpret the claims.

Biggert launched her ad first. The central claim of the ad is that Foster laid off a bunch of workers at the company he founded with his brother and voted to send jobs to China. Though the ad seems to pair the two events, they are not related and took place nearly several years apart. Here's what happened at Foster's company:

Foster and his brother founded Electronic Theater Controls in Wisconsin in 1975. They laid off 61 employees in the economic downturn that followed Sept. 11, 2001. News reports indicate the company had 516 U.S. employees on Oct. 1, 2001.

In 2004, the company built a 250,000-square-foot building in Wisconsin, mostly for additional manufacturing and warehousing, according to Foster. Today the company employs about 654 workers. It's unclear how many of those new employees were hired before 2007, when Foster sold his interest in the company.

The claim about Foster voting to send jobs to China refers to his support for the federal stimulus plan when he was in Congress. That vote came well after the layoffs at his company, but the stimulus did create some jobs in China via a portion intended to create green jobs. Most of those Chinese jobs involved solar and wind power projects.

A report by the nonpartisan Congressional Budget Office says the stimulus created between 1.4 million and 3.3 million jobs in the United States.

Biggert's ad also refers to Foster backing job-killing tax hikes. That's a reference to his support for the Affordable Care Act, also known as Obamacare. Independent fact-checkers agree the health care law will cause some job losses, mostly in low-wage positions.

In response, Foster launched a commercial saying his Republican opponent is the only candidate in the race who has sent jobs to China.

In 2000, Biggert voted to give China permanent "most favored nation" status. The move was intended to open Chinese markets to U.S. companies while also providing American consumers access to less expensive Chinese goods. Asa result, the vote did help U.S. companies create jobs in China.

Both candidates agree there have been some downsides to that trade deal. Foster has been openly critical about China's currency manipulation throughout the campaign, and Biggert was one of 100 Republicans who voted in favor of the Currency Reform for Fair Trade Act in 2010.

She also voted for a resolution calling on China to end human rights abuses and another calling on China to remove barriers to U.S. financial services firms doing business there. In 2004, Biggert supported a measure encouraging China to improve protections on intellectual property rights.

Foster also slams Biggert for voting against reauthorization of Trade Adjustment Assistance programs for workers laid off due to the impact of foreign trade. The program offers up to 130 weeks of employment retraining, reimbursements of up to $2,400 for moving and job search expenses, and a tax credit of about two-thirds of health insurance premiums.

But an MIT study suggests the program provided only 23 cents in trade assistance for each $1,000 in growth of Chinese imports per U.S. manufacturing worker. The same study estimates Chinese exports led to the loss of as many as 1.5 million U.S. manufacturing jobs from 1990 to 2007.

Separate from the China ad duel has been an outcry by both the state and national Republican Party that Foster is a hypocrite for supporting higher taxes without paying them himself.

The charge relates to Foster saying his 2010 vote in support of the Bush tax cuts was a mistake, and he'd support extending the cuts only on incomes below $250,000. Meanwhile, his last tax return shows he paid no income taxes.

Foster said that's because he essentially was unemployed in 2011. He was volunteering with the Bulletin of Atomic Scientists and organizing his run for Congress and, as a result, didn't make enough money to pay federal income taxes. His wife paid about $50,000 in income tax on about $200,000 of income.

But the source of the couple's wealth is the money Foster gets from selling his interest in the theater lighting company. The payouts from that sale are spread over 16 years. He earned about $1.5 million in a payout from 2010 but paid the lower capital gains tax rate on it. That comes to an effective joint tax rate of just less than 19 percent for Foster and his wife, though the couple file their returns separately.

The current salary for a rank-and-file member of Congress is $174,000. If elected, Foster would have a salary and pay income tax. However, it would be below the $250,000 threshold associated with his plan for the Bush tax cuts. That means, if again filing separately, he wouldn't pay the higher tax rates he advocates.

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