Claim Check: Chris Murphy on Linda McMahon’s Business and Political Plans

by Categorized: Claim Check, Employment, Finance, Health, Politics Date:

While Chris Murphy and Linda McMahon ran away with their respective primary wins in this year’s U.S. Senate race, the general election promises to be much, much closer. And if history is a guide, that means we may see plenty of ads on the airwaves for the next couple months that skate mighty close to  – and occasionally over – the edge of accuracy.

That, anyway, is the case with the latest ad from Murphy, the Democratic candidate, which stretches language to make points about McMahon’s business record and political platform.

The ad, titled “McMahon’s WWE Record Exposed,” begins with a pointed look at McMahon’s tenure as CEO of World Wrestling Entertainment, the successful if tacky enterprise that made her a multi-millionaire. But rather than focusing on the crass programming as past political foes have, Murphy takes aim at McMahon’s business decisions, saying her plan for the company included using offshore bank accounts (which the ad illustrates with an image of palm trees on a beach) in order to “shift profits overseas to avoid U.S. taxes.” The ad also says McMahon had a plan to deny employees health and disability insurance coverage to boost profits.

Neither claim is completely accurate.

According to Securities and Exchange Commission documents, WWE’s overseas earnings included $4.1 million that the company said it planned to reinvest in the countries in it which the money was earned, which under I.R.S. rules makes the earnings taxable only in the foreign countries. It is a stretch to describe that as “shifting” profits overseas, a tax-dodging scheme in which companies take profit earned in one country and fiddle with the books in order to credit those earnings to offices – sometimes with no employees – in a different, low-tax country. And given that WWE has authentic operations in foreign countries, it is an even bigger stretch to evoke “offshore bank accounts” – a term universally understood to refer to accounts set up for the purpose of concealing U.S. assets. WWE’s bank accounts in England – it’s largest international market – or Germany are not fairly described as “offshore bank accounts” as that term is commonly used.

There is a far less serious shading in Murphy’s claim on employee health benefits. Critics for years have blasted WWE for failing to provide health and disability insurance to current and former performers (though the company says it covers injuries suffered in the ring). But are those performers “employees”?

On the books, the company’s wrestlers are independent contractors, with negotiated personal-services contracts that set the terms of their compensation, which starts around $100,000 a year and averages $250,000, according to WWE. The company’s traditional full-time employees — secretaries and the like – do receive health benefits, while the wrestlers don’t. WWE defends that disparity saying the performers are paid wages “easily enabling them to afford health insurance.” The Murphy campaign stands by its description of the performers as “employees,” saying at least some contracts include exclusivity clauses barring the wrestlers from working for any other company, and also noting that a broad definition of the word employee includes anyone paid by a firm for work. Nevertheless, while criticizing WWE’s lack of benefits is entirely fair game, given the complexity of the issue, the ad would have been more accurate using a word other than “employees.”

The ad then shifts to McMahon’s current economic proposals, saying her plan includes “tax cuts for the wealthy” that would yield a $7 million tax break for herself, while hurting the middle class with plans to cut Medicare and education.

McMahon has in fact endorsed extending the Bush-era tax cuts for the wealthiest Americans, and under her tax proposal wealthy taxpayers would in fact pay less than they do now. And using McMahon’s 2010 income figures, there is a scenario under which her plan would lead to a tax liability for McMahon that was $7 million lower than her tax liability under a different plan.

But there’s a problem with that $7 million figure that we’ve addressed before in this space.  Last month, McMahon ran an ad suggesting her tax plan would cut the average Connecticut family’s federal income taxes by $6,000 a year. Among a number of problems we cited in that ad was the fact that it failed to disclose that the purported savings did not represent a drop from what families currently paid in taxes, but rather was a comparison to what they would pay in future years if the Bush tax cuts were to expire at the end of December, leading to a jump in tax rates.

Although Murphy’s ad is more likely to be understood in the context of the debate over whether the tax cuts should be extended for wealthier taxpayers, it is still problematic to describe McMahon’s plan as giving herself a seven-figure tax cut without specifying that that is based not on what she currently pays, but on one possible scenario for future tax rates.

The ad’s assertions on cuts to education and Medicare were initially based on McMahon’s proposal to cut the federal budget by 1 percent a year – although not an across-the-board cut. McMahon has declined to identify which programs or departments she would favor seeing reduced, and in the absence of those details, it is a stretch for the Murphy campaign to proclaim that she has made certain spending cuts a part of her budget-reduction plan.

That’s especially true with the hot-button issue of Medicare, which the ad cited based on statements McMahon made in 2010 and 2012. Two years ago, McMahon told CNBC’s John Harmon that she supported some but not all of a deficit reduction plan put forth by Paul Ryan, who favors lower spending on Medicaid.

“Not willing to embrace the Medicare cuts?” Harmon asked.

“Well, I’m going to have to take a look at Medicare cuts,” McMahon responded.

Earlier this month, the New Haven Register reported that McMahon “won’t rule out Paul Ryan’s approach to fixing Medicare, only pledging she will not vote to reduce benefits to those seniors currently benefiting from the federal health care program.”

In the article, McMahon is quoted as saying: “I’m not going to vote to cut any benefits to our seniors who are relying on this today. Are we going to have to reform our Medicare? Yes, we are, But I’m not going to vote to cut anything for our seniors who rely and depend on that today.”

It is not uncommon for political campaigns to turn “won’t rule out” into “plans to” – but as unsatisfying as a dodgy answer may be, it’s not the same as expressing support.

But since the ad came out, the Murphy camp has expanded its criticism of McMahon’s stance on Medicare, saying her support for repealing Obamacare would amount to cuts in some Medicare coverage for some recipients – a contention that, while debated, is a legitimate claim and forms a reasonable basis for Murphy’s assertion on Medicare.

There is nothing blatantly false in Murphy’s latest ad, but there are number of areas in which the facts are spun to best effect. That’s not surprising in an adversarial arena like electoral politics. But particularly with respect to the representations of WWE’s taxes, that spinning goes too far. As such, we rate this ad Somewhat Misleading.

 

View Murphy’s ad below. Click here for more Claim Check columns, and here for information on how we analyze political ads.

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35 thoughts on “Claim Check: Chris Murphy on Linda McMahon’s Business and Political Plans

  1. Fink

    Looks like the WWF pornographer might be CT’s next senator. Says a lot about conservative “family values” voters.

    Reply
    1. skyrocket27

      Hey “Fink” in the event that you haven’t heard, 23 million Americans are out of work as a result of Congressman Murphy and his Democratic colleagues. This election, to use the phase, is all about the economy, stupid.

      Reply
      1. Kim

        good reply skyrocket. Liberals like to complain that people are out of work, but attack conservatives who’s policies might create jobs. It’s the usual contradiction – damned if you do and damned if you don’t. Why allow reason to rule the conversation when verbal sleight of hand will do?

        Reply
        1. Robyn

          I am still waiting to hear Linda’s plan. She has yet to spell out how she plans to accomplish the miracles she plans to pull out of her hat. I want to hear her debate Murphy so we voters can make an informed decision about who we want as our next senator. Is that too much to ask of someone who is running for such a position? I cannot vote for soundbites.

          Reply
      2. Kim

        Fink is well known on courant pages under many other names. Be prepared for name-calling, personal attacks and unsupported charges of racism instead of reasoned debate. Liber

        Reply
  2. Senior Daddy

    “WWF pornographer”?
    That is quite a stretch, even for a liberal. Please show us the pornography moron…

    Reply
    1. Kim

      well said, senior daddy.

      Bob, even the Supreme Court has been unable to clearly define pornography. To pretend that what the WWE offers as entertainment is pornography, flies in the face of the fact that it is PG rated at worst and shown all over the world to children.

      Why would you want to embarass yourself by supporting left-wing talking points instead of honest debate, and doing so with personal attacks?

      Reply
  3. Sharon

    So I guess this will be the next McMahon ad. Keep it up Courant writers, you are providing her campaign with all of it’s material.

    Reply
    1. skyrocket27

      Just a disgruntled Murphy campaign worker Sharon? I guess you have problems with any level of fair examination of the claims made by your boss. The double-speaking, hypocrisy only bothers you when it spoken by someone with a “R” after their name. Sorry for anyone raining on your plans to bamboozle us. With 23 million Americans out of work, we have adult business to conduct.

      Reply
    2. Kim

      the courant is so clearly biased in favor of liberal, democratic views that only another liberal would accuse it of blindly supporting conservatives while overlooking and ignoring everything else. good for you sharon, your truth-meter is about to explode

      Reply
    3. Sharon

      I have a problem with McMahon picking parts of claim checks to validate her using committee attendance as work attendance which even Rob Simmons a republican said is not a valid measure. Nowhere did I say the paper is biased towards conservatives. I simply pointed out that we will probably see this in her next commercial and it is coming from the Courant. Apparently my humor was not understood. BTW I am proud to be a liberal!!!

      Reply
      1. dumdem

        Simmons – Another “Career” Public Servant They are not limited to Dems just because Dems have controlled the Legislature since When??? Quick Quiz When in the history of mankind has the Liberal Agenda worked? No matter how you cut it, it is taking something from Paul to pay Peter Eventually Paul will have nothing, then what? Seeing that in Europe now You are familiar with “To each according to Need From each according to Ability” aren’t you? Without getting into the “leaders” espousing this or its ilk (leaders being an oxymoron since we are all “equal” Right?) do you think that those with Ability (Producers) might, just might, not bother to produce any more than they need? Why would they? There is a big difference between helping and supporting (institutional supporting for votes)

        Reply
  4. GovernmentWorkersAreParasites

    While I’m not the biggest fan of McMahon or Murphy, the fact that corporate taxes and offshoring are such an issue (even with Robomney) should tell you something. America’s tax rate is the 2nd highest in the developed world.

    People need to stop demonizing tax avoidance — there is nothing wrong or immoral about hiding profits from predatory confiscatory compulsory taxation agencies that have legitimized taking your money using armed government agents at gunpoint. It’s robbery and theft, plain and simple.

    The US needs to get it’s tax rates on par with the rest of the world. Countries like Lichtenstein, Switzerland, Singapore, are 1st world nations with a higher quality of life than the USA — yet their corporate tax rates are extremely attractive and drive businesses there. Those countries don’t engage in policing the world and waging pointless wars and are not obsessed with military worship and building an ever-encroaching big brother police state in the name of “security” at great expense to personal liberty.

    America is screwed, and we need a rapid change of direction before we become the next Soviet Union.

    There is nothing wrong with avoiding taxation and cutting off the theft that’s used in not only war, murder and the destruction of freedom — but propping up the government deadbeat welfare cases who leech off the taxpayers. There are DMV and Dept. of Education employees in Connecticut that make $200,000 – $300,000 or more a year. Nobody should go into the public sector to get rich. And thank your public sector unions for not being able to lay off unneeded employees and get rid of the dead weight. Oh, and lets not forget about the corporate subsidies and bank bailouts at your expense.

    We’re competing globally now. We need to create free market conditions to get jobs back in the US. And don’t cry about how this money is going toward schools in infrastructure — our roads are crumbling and public schools are underfunded and churning out complete idiots who can’t even write a proper sentence.

    Until Connecticut and the Federal governments get their act together, expect people to do anything to avoid being extorted and robbed by our predatory governmental apparatus.

    Reply
    1. Kim

      great post taxpayer. It’s the DUTY of every American to take every step to restrict their government from wasting their money. Doing so via legal tax ‘loopholes’ or otherwise is entirely moral and legitimate.

      If you have a problem with the tax loopholes, then let’s talk about restructuring the tax code and simplifying things so taxes will, for once, REALLY be administered fairly. It’s absurd that liberals complain about these pseudo tax issues while ignoring that 47% of eligible taxpayers pay NO income taxes

      Reply
      1. Agree

        Excellent response. 47% pay no taxes and liberals complain about someone who legally uses a tax avoidance procedure. OK everyone who hates loopholes, give up your house mortgage loophole…

        Reply
    2. bill

      Linda’s “offshore accounts” has already been explained, Romneys accounts also have been. that bain garbage is just what it is, repeated falsehoods by the left wing media. my guess is ..just like Murphy’s..if you repeat the lie enough, someone will believe it. he still wont take his political ad off the air about this. busines and residents are fleeing this state for years because of Politicians who have sat on a chair thru repeated terms and screwed us taxpayers by overtaxing and spending and hurting business. This state is not what it was twenty plus years ago. I know alot of people who moved from CT and live a heck of a lot easier and actually take vacations and purchase items they could never get or do in this state.

      Reply
      1. Kim

        right, and many of those leaving are the public sector workers who insist that we are not overtaxed but move because they don’t want to pay CT taxes when they retire. Speaking of hypocrisy and greed. The public sector IS the 1% they complain about so much

        Reply
  5. JustAnotherTaxPayer

    Thank You for the insight into how she or should I say her staff came up with the figures on reduced taxes for the middle class. I couldn’t figure out how she intended to do this reduction, but now that it has been explained that there will be no deduction, and the number was theoretical, based on changes in law that she will never be able to make, elected or unelected, it is leading me to believe that everything she has said in her adds or proposals has no factual basis, and is just being said to confuae the public.

    Reply
  6. skyrocket27

    Perhaps Congressman Murphy could explain to all of us why he towed the Democratic Party line in voting for a “stimulus” package that not only raised the national debt to historic portions, but also shipped American money and jobs overseas.

    To all the comments about the WWE/F-yawn; while Americans and Connecticut residents are trying to dig themselves out of the mess Congressman Murphy and his Democratic colleagues have created, you want to talk about what, sex and violence? Historic national debt, decreased household income, failure to pass a budget in 3 years, 23 million Americans out of work and the fact that 1 in every 3 Americans remain on welfare. You and Congressman Murphy, should know better than to degrade the office of US Senator with comments like these. Stick to the issues, least we all continue to suffer the fate Congressman Murphy has put us in.

    Reply
    1. dumdem

      Can’t agree! With whom we’ve sent to the Senate there is no way it can be further degraded As an aside Rep Murphy supposedly helped write Obamacare (While skipping 80% of info meetings) When queried about it says “I don’t know” Medicare “lost” $716B going to “set up” Obamacare Ask Rep Murphy if Obamacare allows funds in Medicare to be “shifted” to Medicaid Ask Rep Murphy if he knows what Eugenics means That he probably does since BO looked it up for him Ask him about all the talk about Obamacare that doesn’t match up with what’s actually in the law He’s just another Dem hack looking for a lifetime of “public service” How many more in the pipeline? Start with Gov Buy-My-Way-With-Your-Money How can’t the Public rid themselves of a incompetent/crooked Politician in Ct? See who knows Gov looking to “celebrate” War of 1812 Didn’t even know Conn tried to get other States to leave Union and rejoin Great Britain fold Maybe they knew about the Magic Bus plans and didn’t want to pay the higher taxes for the boondoggle borrowing (and of course the usual subsidies) And how about that 1st Five? 2nd Five? Ad Nauseam

      Reply
  7. Rob

    The key message in all of the attacks against McMahon’s and Romney’s wealth is that they did NOTHING ILLEGAL. If the Democrats are so offended by success and legitimate strategies to reduce tax rates, ask Obama why there was no tax reform in his first year of office when the Democrats controlled the House and Senate? They couldn’t even pass a budget.

    Reply
    1. Kim

      Democrats and Obama only applaud success when they’re trying to convince impressionable college students into voting for them, sometimes on the basis of keeping tuition costs low.

      But it’s typical liberal hypocrisy. What’s the point of encouraging our kids to go to college to succeed? Succeed at what? Making money? At what point should they refuse to make any more money, so that people won’t call them ‘filthy’ and attack them with other deragatory names?

      What is the ‘magic number’ that you’re allowed to make before being targeted as too successful?

      Reply
      1. Kim

        I meant “so that people won’t call them ‘filthy rich’. You get the point.

        And the pseudo Romney tax issue? Given this president’s propensity to break the law to get what he wants (such as the recent illegal amnesty which is putting ICE agents in the position of having to ignore current laws and let illegals walk, even the criminals), is there any doubt in anyone’s mind that Obama would NOT use his position to push the IRS to prosecute Romney if he HADN’T paid taxes? And trumpet the news for the media to fawn all over, if it were true? The fact that he hasn’t done either should tell you the truth about this pseudo-tax issue. But you have to be interested in the truth to understand this, I suppose

        Reply
        1. Rob

          Ahhh, the truth. While both sides sometimes struggle with it, this administration is shameful in its cavalier attitude toward it

          Reply
          1. Kim

            absolutely right, Rob. Especially considering this was to be the most ‘transparent’ administratin in history. One of the many blatant lies

  8. wigglesworth

    Why did you not said anything about her lies about 718,000 millions for Medicare cut that everyone for months, even Fox news said was a lie?….PS I talk to her several time about TANF and how the state waste tax payer money by farming poverty…..farming poverty is a program design to fail to maximize federal money….if are state reps do a little research about the waivers for the welfare to work program, we could more move people out of poverty, right now poor people work low end jobs and still get benefit as in food stamps , but if we can move them to a job that paid benefit and enough to paid for food the State can become stronger and close the poverty gap…..but she has no ideas what TANF is, she is going to follow the GOP platform, which is to vilified single mothers and force us into the dark ages

    Reply
  9. Joe

    OMG are conservatives the biggest babies in the world. skyrocket27, name a republican plan to create jobs. Name ONE. You can’t. They’re too busy crying about gay people, immigrants they use as maids and landscapers, and gun rights.

    Reply
    1. Kim

      I’ll help out skyrocket if you don’t mind, Joe. One of the ways they’ll create jobs is by taking full advantage of the amazing natural resources we have in this country which will help us break our chains of dependency on the middle east.

      Now, name one of Obama’s plans to create jobs in the private sector. Why hasn’t he done anything to date?

      But you’re too busy supporting socialist agendas and talking points to face the truth.

      Reply
    2. dumdem

      Let’s start with all the prosecutions for the economic meltdown Zip! And then appoint tax CHEATS as Currency “Czars” Half TARP and the “Porkulus” was BO’s So was the “Green” money How much “reform” was done in the financial sector? DOJ has done nothing about undocs other than sue States for “bothering” them Welfare programs have exploded Regulations are being used to punish certain sectors/companies while rewarding others More of our rights are being lost than under the Patriot Act You waiting for the promised “Civilian Militia” as well or better armed than the military and reporting to whom? Constitution ignored Obamacare outright fraud and shows what the Anti-Federalist papers were afraid of (See Yates) There is just too much to list not to mention regulations we still don’t know about The bailout of the car-industry (with it’s screwing of bond-holders and retirees of Aldelphi)broke law in order to toss it to the Unions, taxpayers still out at least $40Bil from it They will be back for more since contracts not changed Chrysler(Fiat) was begging in the 80’s Cars with the most American parts are Toyotas There is only one plan needed GET GOVERNMENT OUT OF THE WAY! ESPECIALLY the PC BULLPUCKY! RESULTS MATTER! Please clean your glass belly-button so you are better able to see the real world! PS BO will “forgive” debt owed by some sector prior to election to gain votes

      Reply
  10. Lee

    Here we go again. The Democrats want to demonize successful people. The really sad part is how the Connecticut media is in the tank for the Democrats who in turn are in the tank for the Unions and Communist Party.

    Reply
  11. bill

    If linda doesnt win.. i hope vince and her pull up wwe roots and leave this state with their business and move to where taxes are cheaper. That would piss off all those die hard politicians who dont get it..your over taxing and sending residents and business out of state just as you have been doing for the last twenty plus years..get a clue or let fresh faces with fresh ideas and energy to bring this state back to where it was. Career politicians lose the luster they had when they originally ran for office, they lack energy and run with the flow of their party’s doctrine instead of hitting the streets and listening, they only do that when its time to pander for a vote.

    Reply
  12. Pingback: Analyzing the Connecticut Senate Race « Connecticut District 3 Politics

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