We'll go through the key statements in the order in which she said them, which allows us to begin and end with some absolute whoppers."We don't have the $2 billion [to give to Egypt]. Where are we going to get it? From China? We are going to borrow from foreign countries to give to foreign countries. ... We want to know where those dollars are going because we don't have the money to be providing foreign countries, not in this day and age when we are going broke."
Palin managed to get almost everything wrong in this comment.
Except the 'going broke' part, which was the point.
She clearly was not listening too closely to President Obama's speech on the Middle East, because otherwise she would have realized that he was not talking about spending more taxpayer dollars.
Right. Not more. Same as before. $2 billion. If not taxpayer dollars, where did they come from?
Obama proposed to forgive up to $1 billion of Egypt's $3.6 billion debt (money that was spent buying American farm products). The forgiveness, which would take several years, would take the form of a "debt swap," in which the money saved will be invested in designated programs in Egypt.
So we give up a billion, but that's not the same as handing them a billion, so Palin gets a 'Pinocchio'. See how it works? And besides, it was a billion in products, not a billion in cash, so Palin is wrong again!
The other $1 billion would consist of loan guarantees by the Overseas Private Investment Corporation (OPIC), which are structured at no cost to the U.S. taxpayer. So none of this would involve new debt issued by the Treasury.
Until we give up that billion, which our grandchildren will have to pay.
Palin appears to assume that the United States simply hands out dollars with little idea about what happens to the money. This is a common misconception. Actually, there are often strings attached.
So it's not really money, Mr. Pinocchio-awarder?
Under the terms of the 1978 Camp David peace accords between Egypt and Israel, the United States gives about $2 billion in direct aid to Egypt every year, making it one of the largest foreign-aid recipients. But most of this aid -- about $1.3 billion a year -- is financing to buy U.S. military hardware and services.
So we really don't give away money, see? Silly Sarah!
Egypt, for instance, has used the U.S.-supplied funds to replace aging Soviet-supplied equipment with at least 220 F-16 aircraft, 880 M1A1 tanks and 36 Apache helicopters. So Egypt ends up with weapons -- but the money actually goes to U.S. firms and helps create U.S. jobs.
So even if it is giving away real money, which they said it's not, it still creates jobs - in all 57 states.
Palin is also wrong to assume that every dollar of foreign aid would be borrowed. The budget deficit is high, but the U.S. government still takes in substantial revenues. According to the latest Congressional Budget Office forecast, about 40 percent of the federal budget is financed through new debt -- and that percentage is projected to drop significantly as the economy improves.
Silly Sarah! We don't really borrow that $2 billion, it's some other $2 billion we'll have to borrow. Boy, did we ever outsmart you!
Finally, while China is the largest foreign holder of U.S. debt, foreign countries actually hold only about 28 percent of the $14 trillion debt.
So Sarah get a Pinocchio for that? For asking, rhetorically, if the largest holder of debt would take on another measly $2 billion?
The latest Treasury bulletin shows that the biggest holder is the U.S. government itself (i.e., Social Security and Medicare), while U.S. pension funds, mutual funds, insurance companies and state and local governments hold almost as much as foreign investors.
So she didn't list all the options for buying up the debt that the clever WaPo reporter did. Ms. Palin, however, did convey a point in far fewer words than the reporter took to "refute" her. We need to be smarter about where we spend our hard-earned tax dollars. Do I get a Pinocchio for that - disagreeing with your Demolish-the-Evil-Palin theme?
There are three other "refutations" at the link, which sums up with this whopper:
This is a sizable collection of misstatements and bloopers for a 30-minute interview. You could say it is almost Newt-sized.
Clever to the last.