We've got about $3 trillion in trapped cash overseas that basically can't come back in this country because of our tax laws.
When U.S. House SpeakerPaul Ryanmet with Milwaukee Journal Sentinel staff on Sept. 1, 2017, an editor mentionedmajor tax cutsadopted under Republican President Ronald Reagan in 1981. At first, Ryan joked around. The music was bad in those days, and the tax laws were as well, he replied, chuckling. So, I think -- Im not a big 80s music guy; Im more of a 70s guy. But the 47-year-old Janesville Republican quickly got serious. Arguing that U.S. taxes are stopping U.S.-based multinational corporations from bringing giant sums of money to America,he stated: We've got about $3 trillion in trapped cash overseas that basically can't come back in this country because of our tax laws. Ryan has made essentially the same claim a number of times, including onMilwaukee television,on CNBC,on Twitterand to theNew York Times. So, do U.S. tax laws essentially prevent $3 trillion being held overseas from being brought to this country? Keep the wordrepatriatein mind. Taxing foreign earnings The object of Ryans criticism is the U.S. corporate tax rate. At 35 percent, as we reported in aDonald Trumpfact check during the 2016 presidential campaign, it isamong the highestin the world -- though its worth noting that, after deductions, companies typically pay an effective rate that can be much lower. (Trump, by the way, pledged during the presidential campaign to reduce the rate to 15 percent. That promise has been rated asIn the Workson PolitiFact NationalsTrump-O-Meter.) As for the focus of Ryans claim, hes talking about U.S.-based multinational corporations. More specifically, the foreign-earned profits of those companies.Heres an exampleof how the taxation works: If the company earns income in a country with a 20 percent corporate tax rate, it would pay that 20 percent tax immediately to that country. If that money is then repatriated -- that is, brought back to the companys U.S. headquarters -- the company would pay an additional 15 percent to the U.S. government. (In other words, the U.S. tax rate of 35 percent minus the 20 percent already paid to the foreign country.) So, as long as the profits stay parked overseas, there is no U.S. tax on it. Now to the specifics of Ryans claim. The $3 trillion figure To back up Ryans statement, his office cited an April 2017CNBC news articlethat said American companies are holding about $2.6 trillion in overseas earnings, and the figure has been growing. Thats thelatest estimateby Congress nonpartisan Joint Committee on Taxation, for 2015, although an estimate done in July 2017 for PolitiFact National put the figureat $2.8 trillion. So, Ryans claim of about $3 trillion is reasonable. Its worth noting that the figure has been rising. In fact, considering only the Russell 1000 index of large companies, the amount of parked cash overseas has more than doubled since 2008, as shown in a July 2017 report by the Massachusetts research firm Audit Analytics: Year Amount of foreign-earned profits by U.S.-based companies kept overseas 2008 $1.09 trillion 2009 $1.19 trillion 2010 $1.36 trillion 2011 $1.63 trillion 2012 $1.89 trillion 2013 $2.12 trillion 2014 $2.3 trillion 2015 $2.43 trillion 2016 $2.62 trillion Trapped and basically cant come back Ryan asserts that the money is trapped overseas and basically cant come back because of U.S. tax laws To be sure, a substantial amount of foreign profitsare repatriated each year. But Ryan didnt invent the term trapped cash. In fact, academicsfor yearshavereferred to itas a commonly used term to describe the growing amount of cash held by U.S. multinationals overseas to avoid, or at least defer, paying the 35 percent U.S. tax rate. Ryans claim is also backed bySeptember 2017 paperpublished by the National Bureau of Economic Research, a nonpartisan organization in Massachusetts. The paper found a dramatic increase in U.S. corporations holding onto cash; that the cash is concentrated in foreign subsidiaries of multinational corporations; and that it is explained by low foreign tax rates. News articlesalso havereported on the phenomenon. In August 2016,Apple CEO Tim Cook saidof his companys profits parked offshore: Were not going to bring it back until theres a fair rate. Theres no debate about it. Apple is second to Microsoft in the amount of cash parked overseas, according to Audit Analytics. And as the San Jose Mercury Newsreported in May 2017, the tax is such a deterrent that even though Apple was sitting on $240 billion in overseas cash, it has continued to borrow money. The reason: The borrowing cost Apple 4 percent or less, far below the 35 percent tax that would be paid for repatriating the overseas cash. One more point before we close: The companies would like to repatriate the money because bringing it back to the parent company enables them to do things such as paying dividends, doing stock buybacks and investing in U.S. operations. Several academic experts told us that some of the overseas money, while not repatriated directly back to the companies U.S. headquarters, is invested in U.S. securities. That doesnt trigger the 35 percent tax. Our rating Ryan says: We've got about $3 trillion in trapped cash overseas that basically can't come back in this country because of our tax laws. To avoid a 35 percent U.S. tax, U.S.-based multinational companies have opted not to repatriate roughly $3 trillion of their foreign profits, a figure that is growing. That is, they dont bring the money back to their U.S. headquarters, where it can be used for things such as dividend payments or investments in their domestic operations. But the overseas profits arent literally trapped and indeed some foreign-earned profits are repatriated, though they are subject to the 35 percent tax. Ryans statement is accurate but needs additional information, our definition of Mostly True.
Lawmakers on both sides of the aisle agree: The IRS screwed up, big time, when it watched for phrases like tea party to trigger extra scrutiny of groups seeking tax-exempt status. But theres a partisan disagreement over whether it was merely an ill-conceived time-saver for overworked Ohio staffers or a sinister White House plot to hamstring conservative groups before an election. (It's the IRS targeting-gate! said New York Republican Tom Reed.) Rep. Sander Levin, a long-serving Democrat whos the ranking member of the Ways and Means Committee, said after a May 17 hearing that evidence is on Democrats side. My view is that the criteria were very inappropriate, he told MSNBC host Chris Matthews. There was terrible mismanagement. I think there was very terrible oversight. ... But the IG, the inspector general, when asked, Was there any political motivation for the people who were in the exempt organization in Cincinnati, the lower-level people who were working on this, he said no. Was there any outside influence? And he said no. Theinspector general for tax administrationis charged withindependent oversightof the IRS. Did he say there was no political motivation or outside influence driving the agencys inappropriate behavior? Inappropriate criteria The latest round of congressional hearings  and there will be more  kicked off after the May 14 release of amildly titled auditfrom the inspectors office: Inappropriate Criteria Were Used to Identify Tax-Exempt Applications for Review. It asked whether the IRS:  Targeted groups applying for tax-exempt status. Delayed processing of targeted groups applications. Requested unnecessary information from targeted groups, such as donor lists. It found that Cincinnati employees did all of those things, beginning in early 2010. A determinations unit there reviews applications for tax-exempt status for various kinds of organizations  such as charities and nonprofit schools and hospitals. It ran into trouble with applications for501(c)(4)status  a designation that allows a tax-exempt group whose primary activity is social welfare to engage in political activity without disclosing its donors. In theory, a group whose primary activity was actually political activity  such as supporting candidates for office wouldnt qualify. So IRS employees developed criteria to identify and group applications from organizations likely to engage in political activity for a deeper look. But regulations dont define how to measure a groups primary activity. So, according to the report, amid confusion, three inappropriate things happened. For months, employees used phrases such as tea party, patriots, 9/12 and political-sounding names such as we the people, or take back the country to group applications for special review. The criteria got more generic in 2011, then more specific again in mid 2012, including political action type organizations involved in limiting/expanding government, educating on the constitution and bill of rights, social economic reform/movement. Most of those applications languished for more than a year as employees sorted out how to handle them. Then it sent lengthy, probing questionnaires to many applicants, requesting detailed responses, such as lists of all donations and donors, whether any leaders or donors had run for office or would in the future, and lists of all issues important to the organization and its position on those issues. The basic result was that while none of those groups had their applications denied, more than half of them waited more than 200 days  and some as long as three years, across two election cycles. Some are still awaiting decisions. Auditors asked various IRS leaders and employees in Cincinnati and Washington whether anyone outside the IRS influenced the inappropriate criteria. They found the opposite: that one problem was insufficient high-level oversight. Specifically, only first-line management approved references to the tea party, the report said. However, interviews with employees in the Cincinnati office didnt turn up exactly who had been involved in creating the criteria, the report said. Inspector general Since the audit, lawmakers have repeatedly brought in the Treasury inspector general for tax administration, J. Russell George, to testify about the findings of his auditors. Levins staff pointed us to this exchange before Ways and Means, when the congressman asked George to clarify the audits results on outside influence and political motivation: Levin:On page 7, Mr. George, of the IG report it states and all of these individuals stated that the criteria were not influenced by any individual or organization outside the IRS. Is that correct? George:That is the information we received, correct. Levin:Did you find any evidence of political motivation in the selection of the tax exemption applications? George:We did not, sir. Its important to note that George is careful to say that information gathered during the audit didnt point to outside influence or political motivation  not that he was certain it had been ruled out. He was similarly careful in his responses that day to Rep. Jim McDermott, D-Wash., and later, Rep. Ron Kind, D-Wis.: McDermott:The inspector general report says that no one acted out of malice or political motivation. Mr. George, I want to know, do you still stand by that? George:We have no evidence at this time to contradict that assertion, sir. ...  Kind:According to your report, you found no bias or partisanship behind the development and the use of the criteria for selecting applications in the Cincinnati office. Is that right? George:That is correct, sir, but we did find gross mismanagement in the overall  Kind:Right. And that's clear in your report, too. Did you find any evidence that anyone outside of the IRS was involved in the development and review of  George:Not at this time, sir. Kind:Not the White House or Treasury? George:That's correct, sir. Rep. Tim Griffin, R-Ark., pointed out that day that Georges office had conducted an audit, but not yet an investigation. There's a reason you don't know who came up with this. You didn't investigate that, he said. Indeed, George clarified for lawmakers in the days after Levins MSNBC interview that auditorsdidnt ask directlyabout White House involvement, because no evidence pointed that direction. He also distinguished between an audit  designed to uncover systemic problems  and an investigation, which focuses on misconduct by specific people. It is not uncommon for audits to present specific issues that lead to additional reviews or investigations, he said. Our ruling Levin told Matthews on MSNBC that, the inspector general, when asked, Was there any political motivation for the people who were in the exempt organization in Cincinnati, the lower-level people who were working on this, he said no. Was there any outside influence? And he said no. That was the gist of Georges testimony the same day before the Ways and Means Committee, but with the important clarification that he was careful to explain that the assessment was based solely on evidence turned up so far by auditors. Levin offered no such caveat. We rate his claim Mostly True. If you browse Snopes.com, you'll likely come across the advice, "If it seems too good to be true, it it probably is" on pages about social media scams. While this platitude is certainly worth considering when browsing the internet, a few exceptions exist. social media scams The Germany-based search engine Ecosia claims to use its profits to plant trees around the world. Its home page even carries a tally of the number of trees that have reportedly been planted by Ecosia users:   For many people, this business model may seem "too good to be true" and has led to some skepticism about the legitimacy of this company. A search on Google, for instance, results in several articles and blog posts questioning the legitimacy of the search engine and asking whether Ecosia is a scam. As far as we can tell, Ecosia is a legitimate search engine that truly uses a portion of its profits to help plant trees around the world.  Ecosia was launched in 2009 by Christian Kroll. At the time, the search engine was partnered with the World Wildlife Fund (WWF) and promised to donate "at least 80 percent of its income from sponsored links to WWFs rainforest protection programme in Brazils Juruena-Apui region." WWF announced the partnership in a blog post: blog Those people unable to make it to the Copenhagen Climate Conference this month can still contribute to stopping climate change  by using a new search engine from their own computers. The same day the conference begins on Dec. 7, web users can start using a new green search engine called Ecosia. The new application, powered by Yahoo! and Microsofts Bing search engines, will allow internet surfers to protect about 2 square meters of Amazon rainforest just by clicking on sponsored links. Although users do not donate any money themselves, the company behind Ecosia will donate at least 80 percent of its income from sponsored links to WWFs rainforest protection programme in Brazils Juruena-Apui region. The green search engine is a very modern and inventive method of saving the world climate without a huge effort, says WWF Germanys director Eberhard Brandes. Every year billions of dollars are being earned in the internet only from advertising revenue, says Christian Kroll, founder of Ecosia. There is a more eco-friendly way of using these huge profits: the money should better be used to fight global warming. Since 2009, Ecosia has partnered with a number of other environmental organizations. The company reports it uses a portion of its profits to fund these organizations, who in turn work to plant trees around the world.  Ecosia makes money the way most other search engines and websites do: through advertising revenue. While this money covers various business expenses, such as advertising and operational costs, Ecosia claims that the majority of its revenue goes toward funding tree-planting projects.  Ecosia releases monthly financial reports so users can see exactly how the company is spending its money. The most recent full report comes from July 2019. The following report shows that 52% of its total income (approximately 80% of its surplus revenue) was invested in tree-planting projects; 5% was spent on advertising; 30% was spent on operational costs; and 12% went into company "reserves," which are used to fund larger environmental investments: financial reports   We have been unable to independently verify these numbers. However, we checked the websites of several of Ecosia's reported benefactors and found that many of these organizations list Ecosia as one of their partners. Dr. Simon Pfister, managing director of Green Ethiopia, an organization working to grow forests in Ethiopia that received approximately $150,000 from Ecosia in June 2019, told us that Ecosia accurately reported its donation in the company's financial report.  Ecosia is also a Certified B Corporation. This means that Ecosia underwent a third-party evaluation that determined the company had an overall positive impact on its workers, community, and environment. According to the company: Ecosia Certified B Corporation. B Corp Certification doesnt just evaluate a product or service; it assesses the overall positive impact of the company that stands behind it. And increasingly thats what people care most about. Certified B Corporations achieve a minimum verified score on the B Impact Assessment  a rigorous assessment of a companys impact on its workers, customers, community, and environment and make their B Impact Report transparent on bcorporation.net. Certified B Corporations also amend their legal governing documents to require their board of directors to balance profit and purpose. The combination of third-party validation, public transparency, and legal accountability help Certified B Corps build trust and value. B Corp Certification is administered by the non-profit B Lab. Ecosia lets users plant trees by searching the web. In donating 80 percent of its surplus ad revenue, the search engine has raised almost $3 million for reforestation projects since its founding in December 2009. Ecosia's mission to cultivate a world where the environment doesnt need protecting has it working to plant one billion new trees by the year 2020. By supporting high-impact reforestation efforts  as well as neutralising all CO2 emissions related to its search  Ecosia aims to achieve the highest positive environmental impact per dollar possible. By publishing its monthly donation receipts online, Ecosia aims to live up to its users demands for transparency. And by working to improve its charitable web service day after day, Ecosia aims to show the world that small changes can make a big difference. In its mission to plant one billion trees by 2020, Ecosia is working with experts and communities to reforest areas of the world that need it most. Sustainable, high-impact planting strategies mean improvements to the environment, local economies and social stability. Ecosia truly uses a large portion of its profits to fund tree planting projects. Of course, for anyone searching for an environmentally friendly search engine, planting trees isn't the only factor to consider. Ecosia is largely powered by Microsoft's Bing search engine. While Microsoft's global operations have been carbon neutral since 2012, the data centers powering Bing don't run entirely on renewable energy. Microsoft is working toward this goal, however, and expects to be driven by 100 percent renewable energy by 2023: Bing 2012 100 percent renewable energy In our data centers, we will continue to focus on R&D for efficiency and renewable energy. In 2016, we announced that we would power our data centers with more renewable energy, setting a 50 percent target by the end of 2018 and topping 60 percent early in the next decade while continuing to improve from there. We hit the first target nearly a year ahead of schedule, and today we are sharing the news that we will reach the 60 percent milestone before the end of this year. Were therefore setting our next milestone on the path to 100 percent renewable energy, aiming to surpass the 70 percent target by 2023. Well also launch a new data-driven circular cloud initiative using the Internet of Things (IoT), blockchain and artificial intelligence (AI) to monitor performance and streamline our reuse, resale and recycling of data center assets, including servers. For comparison's sake, Google announced in 2017 that its search engine was being powered by 100% renewable energy. announced While Microsoft may not be at quite at 100% renewable energy yet, Ecosia claims that its own servers run on clean power thanks to its new solar plant. Additionally, Ecosia's carbon footprint is lessened due to its involvement with various tree-planting projects around the world. The company says: carbon footprint Renewable energy: Did you know that the CO2 footprint of an average search is estimated at 0.2 grams? Not so with Ecosia. We recently built our own solar plant, so that we can run our servers on clean power. This is even better than buying renewable energy from existing plants, as the plant can deliver clean energy to the grid and replace electricity derived from fossil fuels. Carbon-negative: By planting trees and offsetting its energy use with renewables, each search with Ecosia actually removes 1 kg of CO2 from the air, which makes Ecosia a carbon-negative search engine. Heres the math: an average search generates around 0.005  of revenue. It costs roughly 0.25  to plant a tree, which means that Ecosia can plant one tree every 50 searches. On average, these trees will each remove 50 kg of CO2 during an expected 15 year lifetime. To sum up: Ecosia makes money through advertisements on its search engine. While a portion of that money is used to fund the operational costs of the business, about 80% of its surplus revenue is donated to environmental organizations and tree-planting projects around the world.  Smith, Brad.  "We're Increasing Our CarbonFee as We Double Down on Sustainability."   Microsoft.  15 April 2019. Google.  "100% Renewable is Just the Beginning."
  Retrieved 27 August 2019. Ecosia.  "Financial Reports and Tree-Planting Receipts."
  15 May 2019. World Wildlife Fund.  "Clicks to Help Save Amazon."   3 December 2009. At the end of June 2019, a video supposedly showing a large cloud of pollen dropping from a fallen tree went viral on social media, with one iteration posted by the Facebook page BigDawgsTv racking up several million views within a week of its upload date: https://youtu.be/u7JHwplUAnESome viewers were so shocked to see so much pollen emitted by a single tree that they were skeptical of the clip and questioned whether or not it had been doctored. With our sympathies to those who suffer from allergies, we note that this video is authentic. This video was first posted to the Facebook page of the Washington-based company Matts Tree & Landscape in May 2019, along with a message announcing the start of "allergy season":  A small portion of a company sign can be seen at the start of the video displaying the first three digits of a phone number (425, a Seattle area code), a logo, and the first two letters of the company name ("MA"). The same sign can also be seen in a photograph posted to the company's Facebook page: photograph   While this video may have been shocking to some viewers, this wasn't the first time that an online video captured a large pollen cloud falling from a tree. In May 2018, a Kentucky Facebook user posted a similar video showing a machine shaking the pollen off of a tree, and that clip was picked up and shared by several local and national news outlets: posted picked shared local  Sheila McCormick, an adjunct professor of plant and microbial biology at the University of California, Berkeley, talked to Live Science shortly after the latter video went viral in 2018 and explained that while the scene may have been unsettling to some viewers, such pollen clouds aren't unusual: Live Science Pollen is a grainy, plant-produced substance that carries the tools that seed-plants need to create male gametes  aka, sperm. While pollen is not actually sperm itself, pollen grains do contain the cells necessary to transfer the male half of the plant's DNA to a compatible plant's female counterparts (like the pistil and female cones). You could say, as Live Science writer Natalie Wolchover once did, that pollen is plant sperm powder ... "This [scene] is not unusual," Sheila McCormick, an adjunct professor of plant and microbial biology at the University of California, Berkeley, told Live Science. "In general, most plants produce much more pollen than is needed. For example, a single corn plant produces 2 [million] to 5 million pollen grains, and an ear of corn has a few hundred seeds. This is especially true for plants that are wind-pollinated." Pine trees, like the ones in the video above, are no exception. Some species of pine can produce up to 5 lbs. (2.2 kilograms) of pollen in just a few weeks, according to Robert Bardon, associate dean for extension in the department of forestry and environmental resources at North Carolina State University. Why make so much pollen? Call it offspring insurance. Specktor, Brandon.  "Watch a Massive 'Pollen Cloud' Explode from Late-Blooming Tree."
  Live Science.  9 May 2018. Katz, Brigit.  "Watch This Pine Tree Unleash a Huge, Fluffy Pollen Cloud."
  Smithsonian.  10 May 2018. Ball-Point Pens for the Astronauts When NASA started sending astronauts into space, they quicklyDiscovered that ball-point pens would not work in zeroGravity. To combat this problem, NASA scientists spent aDecade and $12 billion developing a pen that writes in zeroGravity, upside-down, on almost any surface including glassAnd at temperatures ranging from below freezing to over 300 C. The Russians used a pencil. Your taxes are due again  enjoy paying them. [The Moscow Times, 2000] There is a charming anecdote that roams from e-mail box to e-mail box around the world about how, at the height of the space race, the Americans and Soviets approached the same problem: how an astronaut (or cosmonaut) could use a pen to write in zero gravity. As the story goes, the Americans spent hundreds of thousands of dollars on an ambitious, gravity-immune ballpoint pen; they successfully developed such a pen; and this pen went on to become a massive commercial success in the private sector. The Soviets  with the simple elegance their scientists are so rightly famed for  opted instead to use a pencil. Thelesson of the infamous "space pen" anecdote related above, about NASA's spending a small fortune to develop a ballpoint pen that astronauts could use in outer space while completely overlooking the simple and elegant solution adopted by the Soviet space program (give cosmonauts pencils instead), is a valid one: sometimes we expend a great deal of time, effort, and money to create a "high-tech" solution to a problem, when a perfectly good, cheap, and simple answer is right before our eyes. As good a story and moral as that may be, however, this anecdote doesn't offer a real-life example of that syndrome. Both U.S. astronauts and Soviet cosmonauts initially used pencils on space flights, but those writing instruments were not ideal: pencil tips can flake and break off, and having such objects floating around space capsules in near-zero gravity posed a potential harm to astronauts and equipment. (As well, after the fatal Apollo 1 fire in 1967, NASA was anxious to avoid having astronauts carry flammable objects such as pencils onboard with them.) When the solution of providing astronauts with a ballpoint pen that would work under weightless conditions and extreme temperatures came about, though, it wasn't because NASA had thrown hundreds of thousands of dollars (inflated to $12 billion in the latest iterations of this tale) in research and development money at the problem. The "space pen" that has since become famous through its use by astronauts was developed independently by Paul C. Fisher of the Fisher Pen Co., who spent his own money on the project and, once he perfected his AG-7 "Anti-Gravity" Space Pen, offered it to NASA. After that agency tested and approved the pen's suitability for use in space flights, they purchased a number of the instruments from Fisher for a modest price. This is how Fisher themselves described the development of their Space Pen: NASA never asked Paul C. Fisher to produce a pen. When the astronauts began to fly, like the Russians, they used pencils, but the leads sometimes broke and became a hazard by floating in the [capsule's] atmosphere where there was no gravity. They could float into an eye or nose or cause a short in an electrical device. In addition, both the lead and the wood of the pencil could burn rapidly in the pure oxygen atmosphere. Paul Fisher realized the astronauts needed asafer and more dependable writing instrument, so in July 1965 he developed the pressurized ball pen, with its ink enclosed in a sealed, pressurized ink cartridge. Fisher sent the first samples to Dr. Robert Gilruth, Director of the Houston Space Center. The pens were all metal except for the ink, which had a flash point above 200C. The sample Space Pens were thoroughly tested by NASA. They passed all the tests and have been used ever since on all manned space flights, American and Russian. All research and development costs were paid by Paul Fisher. No development costs have ever been charged to the government. Because of the fire in Apollo 1, in which three Astronauts died, NASA required a writing instrument that would not burn in a 100% oxygen atmosphere. It also had to work in the extreme conditions of outer space: (NASA tested the pressurized Space Pens at -50C, but because of the residential [sic] heat in the pen it also writes for many minutes in the cold shadows.) Fisher spent over one million dollars in trying to perfect the ball point pen before he made his first successful pressurized pens in 1965. Samples were immediately sent to Dr. Robert Gilruth, Manager of the Houston Space Center, where they were thoroughly tested and approved for use in Space in September 1965. In December 1967 he sold 400 Fisher Space Pens to NASA for $2.95 each. Lead pencils were used on all Mercury and Gemini space flights and all Russian space flights prior to 1968. Fisher Space Pens are more dependable than lead pencils and cannot create the hazard of a broken piece of lead floating through the gravity-less atmosphere. Paul Fisher continues to market his space pens as the writing instrument that went to the moon and has spun off this effort into a separate corporation, the Fisher Space Pen Co.: Space Pen   Sightings:  This legend was referenced in an episode of NBC's The West Wing TV series ("We Killed Yamamoto"; original air date 15 May 2002): https://youtu.be/LQy1DH38E5g Curtin, Ciara.   "NASA Spent Millions to Develop a Pen That Would Write in Space."  
 Scientific American.   20 December 2008. Garber, Steve.  "The Fisher Space Pen."  
 NASA.gov. The Moscow Times.  "Pencil Us in for the Next Y2K Disaster." 
 14 January 2000. In mid-2015, social media users got their collective hopes up about the advent of the pizza vending machine, an innovation that would enable them to obtain one of their favorite things (pizza) while simultaneously avoiding one of its least popular aspects (human interaction). Tweets and Facebook posts about the pizza vending machine (called "Let's Pizza") touted the announcement of this "new" concept: @italiaricci You should get one for your house! #PizzaVendingMachine #NowIWantOne pic.twitter.com/3SV5Z9bAuX @italiaricci #PizzaVendingMachine #NowIWantOne pic.twitter.com/3SV5Z9bAuX  Stephanie (@Xxsteff22xX) July 1, 2015 July 1, 2015  Photo: #PizzaVendingMachine this is so cool!!! https://t.co/V0S2MtG9sB #PizzaVendingMachine https://t.co/V0S2MtG9sB  Linda Glatham (@LindaGlatham) June 30, 2015 June 30, 2015  The tone of the social media buzz suggested that pizza vending machines were, if not yet popping up all over the place, at least a soon-to-be common sight. (Although hot food vending machines are somewhat common, the novelty of one devoted specifically to pizza apparently fires the imagination.) Interest in the concept in mid-2015 appeared to stem in part from a confusing article titled "Watch This Vending Machine Make Pizza" that was dated 27 June 2015 but had been originally published on 21 March 2014, featuring a YouTube clip uploaded in February 2013 that was filmed in 2012: published During our trip to Italy in 2012, in the little town of Sorrento, my wife and I discovered a Lets Pizza vending machine that promised freshly made pizza in just 2.5 minutes and all for 3 euros. It was such a novel idea, we figured we had to film the whole process.  In a 5 March 2014 article published in The Gate entertainment magazine, the author described encountering one of these contraptions in Sorrento, Italy, the same place where the video clip seen above was shot: article My last travel piece about Sorrento was filled with details about why I loved this beautiful town along the coast of Italy. There was one other reason why I loved the town though, and it all came down to a magical vending machine that made pizzas. Yes, its a pizza vending machine (called Lets Pizza), and it makes them from scratch. For 3 euros, this machine mixes up dough from scratch, covers it in pizza sauce and cheese, and then bakes itall in less than 2-and-a-half minutes. On 14 June 2012, the pizza vending machine branded "Let's Pizza" was covered by The Frisky in an article that touted the machines as soon to arrive in the U.S.: article Turns out the pizza gods have heard our prayers, because an innovative pizza vending machine called Lets Pizza is finally making its way to the States. The Lets Pizza has been popular in Europe for years (for obvious reasons), but heres what Americans can expect ... A Facebook page for Let's Pizza UK also promoted the concept, but that page hasn't been updated since 2011, and the mid-2015 reaction to the pizza vending machine rumors that circulated on social media indicated that if any of the machines already existed in the United Kingdom, they weren't very popular or well-known. Let's Pizza UK In April 2015, Rochester television station WHEC tweeted about pizza vending machines: Local business offers pizza vending machines @whec_rleclair has the story https://t.co/K0F8flxpFb @whec_rleclair https://t.co/K0F8flxpFb  news10nbc (@news10nbc) April 21, 2015 April 21, 2015  However, that tweet linked to an on-site article describing a different pizza vending machine, Pizzametry, that was still in the conceptual stages: article It's a pizza vending machine that creates hot, fresh pies and the prototype is in Webster. So the search is on for investors, possible manufacturers and vendors to help Pizzametry grow along with the upstate economy and its all thanks to the pizza lovers of the Rochester region ... The pizzas will sell for about $4 to $6. The machines can be built for $28,000. A Daily Mail article published in July 2014 reported the "Let's Pizza" machines had not caught on after their 2009 unveiling, primarily due to their considerable size and cost: article The Let's Pizza machine was unveiled by Mr Torghele in 2009 but has been slow to catch on. The downside is that it is each one is the size of nearly three average vending machines. It also retails for more than ten times the amount, at $32,000. When the meme peaked, there was perhaps at least one "Let's Pizza" pizza vending machine operating in Sorrento, Italy -- but predictions of its immigration to the United States were then largely unfulfilled. But in 2016, the Tampa Bay Times reported that a handful of the machines popped up in Florida; at least one more was spotted in Ohio: reported Guys, the stories are true! Xavier now has North America's first Pizza ATM and we got it j https://t.co/oVJlzHXjsv pic.twitter.com/mbTvsQQmpz https://t.co/oVJlzHXjsv pic.twitter.com/mbTvsQQmpz  Xavier Admissions (@XUAdmissions) August 5, 2016 August 5, 2016  In January 2017, Grub Street noted that "after nearly four years of teasing," an unreported number pizza vending machines were scheduled to be installed that month. Little Caesar's announced a "Pizza Portal" in August 2017, but the technology still required a trip to the store to pick up a pizza. Although a handful of pizza vending machines appeared in the United States after the meme circulated, they remained few and far between as of late 2017. noted announced Is workforce participation lower in West Virginia than in any state? Thats what West Virginia University president Gordon Gee wrote in a recentop-ed. Gees Jan. 14 column in the State Journal newspaper was titled, An effective education system is key to West Virginias future. In the column, Gee wrote, As I often point out, our state does not have a job problem. It has a skills problem that leaves many high-paying jobs unfilled. We have the nations lowest workforce participation rate, which hovers around 50 percent, when the national average is about 63 percent. Is this claim accurate? We took a closer look. Economists say the most appropriate statistic in this case is the civilian labor force participation rate, which is calculated on a regular basis by the federal Bureau of Labor Statistics. Thestatistictakes the number of people who are employed, adds it to the number of unemployed people who are looking for work, and divides the sum by the total population that is at least 16 years of age, not serving on active duty in the military, and not institutionalized in a facility such as a prison or a long-term-care home. The most recentdataavailable from the Bureau of Labor Statistics, from December 2018, showed that West Virginia had a civilian labor force participation rate of 53.9 percent. The figure didnt deviate much throughout 2018, ranging from 53.7 percent to 54 percent depending on the month. The past five years also looked similar to 2018. The average workforce participation rate in 2018 was 53.9 percent. In 2017 it was 53.3 percent, in 2016 it was 53.1 percent, in 2015 it was 52.8 percent, and in 2014 it was 53.1 percent. He would have been a little closer using a similar, but distinct, statistic known as the employment-population ratio. This statistic takes the number of employed people and divides it by the same overall population used in the civilian labor force participation rate. In West Virginia, that was 51.2 percent in December 2018, and was close to that during 2018. So for this part of his statement, Gee was close, and he did say around 50 percent, which gives him some wiggle room. West Virginia did indeed have the lowest civilian labor force participation rate in the nation in December 2018. The next-closest state was Mississippi, with 55.8 percent. And the pattern was much the same for the rest of 2018. In fact, West Virginia has remained in the lowest spot since the U.S. Bureau of Labor Statistics began reporting the series on a consistent basis in 1976, said Brian Lego, research assistant professor at West Virginia Universitys Bureau of Business and Economic Research. Thenational civilian labor force participation ratewas 63.1 percent in December 2018, after rising from a low of 62.7 percent earlier in the year. So Gee is on target with his statement that the national rate was about 63 percent. Lego said there are a range of factors that explain the states weak performance. The big picture reasons are related to human capital deficiencies such as lack of skills needed for jobs available, he said. He also cited poor health, drug abuse, and a large number of elderly residents in West Virginia. Gee said, We have the nations lowest workforce participation rate, which hovers around 50 percent, when the national average is about 63 percent. He was very close on all three elements of the statement, and he gave himself some breathing room by using the words around and about. We rate his statement True. One of the more unusual political memes we've come across presented four different cases of tax-related financial improprieties to suggest that tax-evasion prosecutions were somehow influenced by racial bias against non-blacks:  However, the "Tax Racism" meme offered examples  not all of which were actual cases of tax evasion  so widely spaced in time and so differing in circumstances as to be non-useful in making any point at all about either tax fraud or race. Martha Stewart, the entrepreneur who rose to prominence as the author of books on cooking, entertaining, and decorating, was not charged with, or imprisoned for, non-payment of income taxes. Stewart was found guilty in March 2004 of felony charges of conspiracy, obstruction of an agency proceeding, and making false statements to federal investigators in a case related to a U.S. Securities and Exchange Commission (SEC) investigation into insider trading activity: investigation Washington, D.C., June 4, 2003 -- The Securities and Exchange Commission today filed securities fraud charges against Martha Stewart and her former stockbroker, Peter Bacanovic. The complaint, filed in federal court in Manhattan, alleges that Stewart committed illegal insider trading when she sold stock in a biopharmaceutical company, ImClone Systems, Inc., on Dec. 27, 2001, after receiving an unlawful tip from Bacanovic, at the time a broker with Merrill Lynch, Pierce, Fenner & Smith Incorporated. The Commission further alleges that Stewart and Bacanovic subsequently created an alibi for Stewart's ImClone sales and concealed important facts during SEC and criminal investigations into her trades. In a separate action, the United States Attorney for the Southern District of New York has obtained an indictment charging Stewart and Bacanovic criminally for their false statements concerning Stewart's ImClone trades. Stewart was sentenced to 5 months in prison and also settled a civil suit with the SEC by paying a $195,000 fine (a penalty that reflected four times the amount of stock value loss she avoided by taking advantage of inside information, plus interest). settled Stewart did engage in a dispute with the state of New York in 2002 over unpaid property taxes that she contended she didn't owe because she hardly spent any time in that state, and she was eventually ordered by a judge to pay $220,000 in back taxes plus penalties. But contrary to the false impression created by this meme, she was not prosecuted or jailed over that issue  the time she spent in prison was solely related to a later insider-trading case, not to tax evasion. dispute By the mid-1920s, notorious Chicago mobster Alphonse Gabriel Capone was reportedly taking in nearly $60 million annually ($878 million in 2018 dollars) from a variety of illegal activities, primarily Prohibition-era bootlegging. Capone was dubbed "Public Enemy No. 1" after the 1929 Saint Valentine's Day Massacre in which gunmen allegedly hired by him posed as police officers to murder seven members of a rival gang, leading to increased public pressure on the government to rein Capone in. Federal authorities had difficulty gathering sufficient hard evidence to convict Capone on any substantial criminal charges, however, so they took what was then a novel tack: Even if they couldn't prove Capone was making his millions illegally, they could prove he wasn't paying income tax on his ill-gotten gains. Despite his obviously lavish lifestyle, Capone never filed a federal income tax return and claimed he had no taxable income, reportedly boasting at one point that, They can't collect legal taxes from illegal money. He was proved wrong. IRS and Treasury agents gathered evidence that Capone had made millions of dollars in untaxed income, and the mobster was eventually indicted on 22 counts of federal income tax evasion. After conviction he was sentenced in 1931 to 11 years in prison, fined $50,000, and ordered to pay back taxes in the amount of $215,000. Capone was released from prison in 1939 with time off for good behavior and retired to Florida, where he died in 1947 at the relatively young age of 48. conviction In a literal sense Capone was indeed jailed for non-payment of income taxes, but the tax evasion charges were essentially a proxy for prosecuting the mobster over the multitude of vastly worse and violent crimes with which he was connected (and the immense profits he derived from those criminal activities). Capone was by no means an otherwise upright and law-abiding citizen who was thrown in prison simply because he didn't pay his income taxes. At this point in our narrative we need to distinguish between different forms of tax evasion. At one end of the spectrum are those who haven't engaged in any fraudulent behavior but simply didn't or can't pay their taxes for any number of reasons  maybe they didn't plan or withhold prudently, they received poor financial advisement, they had legitimate confusion or dispute over what constituted taxable income, or they simply overspent and ended up in debt. Although non-payment of taxes is a crime, the IRS will not usually seek prosecution in these types of case and will instead work with offenders in order to facilitate payment of their back debts (rather than making repayment difficult or impossible by incarcerating them). prosecution At the other end of the spectrum are those who actively engage in fraud in order to evade the full payment of taxes: They fail to disclose their full income, hide financial transactions, claim deductions to which they are not entitled, disguise monies earned as something other than income, or otherwise file falsified tax returns. The IRS will, at their discretion, seek prosecution in egregious cases of these forms of tax evasion. Leona Helmsley, derisively known by the nickname as the "Queen of Mean," was a billionaire who  along with her husband, real estate investor and broker Harry Helmsley  owned a vast portfolio of real estate and other assets, including a chain of hotels and the iconic Empire State Building. portfolio Leona Helmsley, who once reportedly asserted that We dont pay taxes. Only the little people pay taxes, fell into the latter class of tax evader, falsely manipulating her personal finances, business expenses, and dealings with third parties in order to avoid paying immense sums of taxes: tax evader Some of [Helmsley's] luster was tarnished in 1986 when court documents and law enforcement officials said she had failed to pay sales taxes in New York on hundreds of thousands of dollars of jewelry she purchased at Van Cleef & Arpels, the exclusive Manhattan store. Two senior store officers were indicted on charges that they operated a scheme by which customers with out-of-state addresses could have their purchases recorded as being mailed to them, thus avoiding city and state taxes. In 1987 a series of adverse articles in The New York Post about the Helmsleys, set off by one of their disgruntled employees, led to a broad investigation. The following year Harry and Leona Helmsley were indicted by federal and state authorities on charges that they had evaded more than $4 million in income taxes by fraudulently claiming as business expenses luxuries they purchased for Dunnellen Hall in Greenwich, Conn, a 28-room Jacobean mansion on 26 acres with a sweeping view of Long Island Sound that they bought in 1983. In 235 counts in state and federal indictments brought by Robert Abrams, then the New York State attorney general, and Rudolph W. Giuliani, then the United States attorney and later mayor of New York, the Helmsleys were accused of draining their hotel and real estate empire to provide themselves with such extravagances at Dunnellen Hall as a $1 million marble dance floor above a swimming pool, a $45,000 silver clock, a $210,000 mahogany card table, a $130,000 stereo system, and $500,000 worth of jade art objects. Nothing was too small or personal to be billed to their businesses, from Mrs. Helmsleys bras to a white lace and pink satin dress and jacket and a white chiffon skirt  the dress and skirt were entered in the Park Lane Hotel records as uniforms for the staff. Mrs. Helmsley was also charged with defrauding Helmsley stockholders by receiving $83,333 a month in secret consulting fees. She was convicted of 33 felony counts related to her evasion of $1.2 million in federal income taxes. She was sentenced to 16 years in prison (reduced to four years on appeal), fined $7.1 million for tax fraud, and ordered to pay some $1.7 million in back federal and state taxes. She began serving her sentence in 1992 and was released from federal prison in Connecticut in 1994 after having served less than half her sentence. Where along the tax-evader spectrum between "legitimate dispute" and "willful tax fraud" civil rights activist Al Sharpton might fall is a difficult to determine. Claims were made in the press in 2014 that Sharpton owed some $4.5 million in unpaid taxes, but the accuracy of that number and how much of the monies owed might already have been repaid by Sharpton were unclear, and his tax-troubles narrative involved a muddied mixture of personal, business, and non-profit finances as well liabilities for federal taxes, state taxes, payroll taxes, and personal income taxes. Much of the dispute over the "why" and "how much" of Sharpton's unpaid tax bill stemmed from the operations of the National Action Network, a not-for-profit, civil rights organization founded by Sharpton in 1991. Sharpton contended in a 2014 New York Times account that he incurred an unexpected tax liability because he was taxed personally for income he had given to the non-profit organization, and that he was up to date on repayment plans. Officials contested that the amount he was in arrears for in unpaid taxes had actually grown larger, though: contended Today, Mr. Sharpton still faces personal federal tax liens of more than $3 million, and state tax liens of $777,657, according to records. Mr. Sharpton said the federal liens resulted from a demand by the I.R.S. that he pay taxes on earnings from speaking engagements that he had turned over to National Action Network. He said he was up to date on payment plans for both the federal and state liens, so, he said, the outstanding balance was much lower than records showed. But according to state officials, his balance on the state liens is actually $220,000 greater now than when they were first filed during the years 2008 through 2010. A spokesman for the State Department of Taxation and Finance said state law did not allow him to provide any further details. Sharpton then contested that news account, asserting that it referenced "old taxes" and insisting again his tax liens had been paid down below the $4.5 million debt claimed in the New York Times report that stated Sharpton's unpaid tax debt had nonetheless grown larger, not smaller: contested During a news conference at the headquarters of his National Action Network in Harlem, Mr. Sharpton sought to refute the assertion that there were $4.5 million in state and federal tax liens outstanding against him and the for-profit businesses he controls. He said that the liens had been paid down, although he declined to say by how much, and that he was current on all taxes he was obligated to pay under settlement agreements with tax authorities. Were talking about old taxes, he said, adding: Were not talking about anything new. So all of this, as if Im not paying taxes while Im doing whatever Im doing, it reads all right, but it just is not true. The accuracy of Mr. Sharptons assertion that the amount he owes the federal government is much lower than the $3.6 million shown in records could not be verified. A spokesman for the Internal Revenue Service said federal law prohibited the agency from divulging any details about individual taxpayers. As for the state tax liens, Mr. Sharptons assertion that he had paid them down conflicts with information provided by state officials. State authorities filed tax liens against Mr. Sharpton in 2008 and 2009, and again in 2010 against a for-profit business he controls, Revals Communications, all totaling $695,000. But a spokesman for the State Department of Taxation and Finance said the amount due had actually increased, to $916,000. Regardless of the numbers, Sharpton wasn't put in prison because tax officials did not deem his case to be an exceptional one of scofflaw tax fraud or evasion that merited prosecution, instead working with him to facilitate his paying down the debt. The conclusion here is a simple one: Cherry-picking four very disparate cases of financial wrongdoings spanning several decades, while ignoring the many other instances of tax evasion successfully prosecuted by the U.S. government, documents nothing about any purported racial bias in such prosecutions. tax evasion Buettner, Russ.  "Al Sharpton Criticizes New York Times Report on Unpaid Taxes."
  The New York Times.  19 November 2014. Buettner, Russ.  "As Sharpton Rose, So Did His Unpaid Taxes."
  The New York Times.  18 November 2014. Nemyaug, Enid.  "Leona Helmsley, Hotel Queen, Dies at 87."
  The New York Times.  20 August 2007. Erb, Kelly Phillips.  "Al Capone Sentenced to Prison for Tax Evasion on This Day in 1931."
  Forbes.com.  17 October 2018. Wood, Robert W.  "10 Notorious Tax Cheats: Queen of Mean Leona Helmsley Proved Little People Can Put You in Jail."
  Forbes.com.  17 April 2015. Wood, Robert W.  "Lessons From Rev. Al Sharpton's $4.5 Million Tax Bill."
  Forbes.com.  19 November 2014. Department of Justice -- Office of Public Affairs.  "Tax Crime Does Not Pay."
  10 April 2018. Johnson, Carrie.  "Stewart to Pay $195,000 in Settlement of Civil Suit."
  The Washington Post.  8 August 2006. Kratsas, Gabrielle.  "13 Infamous Tax Cheaters."
  USA Today.  28 February 2014. On 23 December 2016, a woman identifying herself as Catherine Elizabeth Clennan created a GoFundMe campaign destined for viral attention, in which she asked donors to supply her with US$5,000,000 in order to fulfill her "lifelong dream" (of having five million dollars). Clennan's bid for money stated that at 27, she dreamed of one day being independent of her family who "pay for everything" for her. Although she said that she hoped to raise $2,000,000 to buy a home in California, the campaign's goal was set at more than twice that amount: My name is Catherine Elizabeth Clennan and my whole life I have been trying to live by other's definitions of who I 'should be'. I have been trying so hard to live this lie that I came face to face with a choice: either live as others definitions of you and die OR strike out on your own and find for yourself who you really are. Well I chose life. I chose to live by my own definition ... With this choice I am in the process of turning my life in a new direction. Currently I live in Laramie, Wyoming. in a property owned by my family. They pay everything for me - and I am 27 years old. I feel that as long as I live by their definition I am 'taken care of', but this definition is leading me to deaths door - it forces me to live a lie - to turn my back to who I really am; a free spirit, an artist, a woman, a lesbian, a civil rights activist, a woman who goes against the grain, a woman who knows that not everything is as it seems. I need $2,000,000 dollars to purchase my dream home in California. I need the money to help me walk out of the lie that I am living, but more importantly I need the money to live my dream - which is to live as much as my life in the spiritual dimension as possible. The money will go towards the purchase of a new home, new transportation, and the various fees and taxes that accumulate with a move across the country. These funds will help me live the life that I feel I am meant to live, the life I want to live - the life defined not by other people - but by me. These funds will help me break free from the tyranny of what other people think is 'right'. The 'right' job, the 'right' education, the 'right' way to earn a living...   Although GoFundMe marked the campaign as "trending" as of 28 December 2016, Clennan had only received $21 of that goal on that date:   Although she has not indicated that her campaign is a hoax or prank (and GoFundMe has not flagged or removed it), Clennan does not appear to have much of an online footprint other than this campaign, aside from a LinkedIn profile and what may be a Huffington Post contribution (which as of April 2016 indicated she was an active student). That single article led some social media users to claim Clennan worked for the Huffington Post, but it looked as if she had submitted only one piece as a contributor. LinkedIn contribution In that article, Clennan expressed a desire to "be a public figure": Exposing my vulnerabilities publicly and confidently gave that girl the strength she needed to participate. Thats when I knew exactly what I wanted to do with my life  I want to use computer science to inspire other women to explore computer science. I want to be a public figure in computer science that is the exact opposite of what you would typically expect to find in the field. I want to be that girl who no one thought she could, who had all the odds against her, that everyone thought was dumb, and yet she becomes incredibly successful in computer science. Then I want to turn that success around and use it as a pedestal to expose every wound, every failure, every painful vulnerability I have, even with my hands trembling, Clennan invited potential donors to visit her Facebook page for more information, but few additional details were available there. It remains possible that her goal is genuine and presented honestly with no expectations that it would go over poorly or go viral, but also within the realm of possibility that the GoFundMe request was a step in her stated aim to become a public figure. Facebook Clennan, Catherine.  "The Benefits Of Being A Dumb Girl In Computer Science."
  Huffington Post.  12 April 2016. Claim:  E-mail reproduces a 1999 newspaper article warning about potential troubles with Fannie Mae. Status:  True. Example:  [Collected via e-mail, September 2008] Right out of the pages of the NY Times!!!And look at the date..!!!  September 30, 1999Fannie Mae Eases Credit To Aid Mortgage Lending  In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders. The action, which will begin as a pilot program involving 24 banks in 15 markets  including the New York metropolitan region  will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.  [Rest of article here.] here Origins:  In any crisis, one of the most common reactions is to ponder the question, "How did we get into this mess?"  People begin to search for explanations about who was responsible for bringing about the current state of  affairs, who had the ability to head it off (but failed to act or was thwarted), and who foresaw the looming danger (but declined to speak up or was ignored).  With the United States currently in the throes of an economic crisis, of which one symptom was the September 2008 government takeover of the foundering Federal National Mortgage Association (commonly known as Fannie Mae), a nine-year-old warning about the home mortgage underwriter's being vulnerable to economic problems that could require government rescue was bound to pique public interest. On 30 September 1999, the New York Times published an article entitled "Fannie Mae Eases Credit to Aid Mortgage Lending" by Steven A. Holmes.  The complete text of the article is available online, but in a nutshell the Times reported that Fannie Mae was easing its credit requirements for home mortgage loans in response to increasing pressure from a variety of groups: text  Clinton administration officials who wanted Fannie Mae "to expand mortgage loans among low and moderate income people" (particularly minority groups).  Stockholders who wanted Fannie Mae "to maintain its phenomenal growth in profits."  Banks, thrift institutions and mortgage companies (from whom Fannie Mae purchases loans) who wanted the company to facilitate  "more loans to subprime borrowers." In light of recent events, what caught the attention of most readers was a couple of paragraphs in the middle of the article cautioning about the possible consequences of Fannie Mae's loosening its credit requirements: In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.  "From the perspective of many people, including me, this is another thrift industry growing up around us," said Peter Wallison a resident fellow at the American Enterprise Institute. "If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry." Another New York Times article that has attained a significant amount retrospective interest is an 11 September 2003 article entitled "New Agency Proposed to Oversee Freddie Mac and Fannie Mae" by Stephen Labaton, which reported on the efforts of the Bush administration to create a new regulatory agency to assume oversight of those mortgage lenders: article The Bush administration today recommended the most significant regulatory overhaul in the housing finance industry since the savings and loan crisis a decade ago. Under the plan, disclosed at a Congressional hearing today, a new agency would be created within the Treasury Department to assume supervision of Fannie Mae and Freddie Mac, the government-sponsored companies that are the two largest players in the mortgage lending industry. The new agency would have the authority, which now rests with Congress, to set one of the two capital-reserve requirements for the companies. It would exercise authority over any new lines of business. And it would determine whether the two are adequately managing the risks of their ballooning portfolios. The plan is an acknowledgment by the administration that oversight of Fannie Mae and Freddie Mac  which together have issued more than $1.5 trillion in outstanding debt  is broken. A report by outside investigators in July concluded that Freddie Mac manipulated its accounting to mislead investors, and critics have said Fannie Mae does not adequately hedge against rising interest rates. Of especial interest to current readers were the following paragraphs about Congressional resistance to the Bush administration's regulatory proposal: Significant details must still be worked out before Congress can approve a bill. Among the groups denouncing the proposal today were the National Association of Home Builders and Congressional Democrats who fear that tighter regulation of the companies could sharply reduce their commitment to financing low-income and affordable housing. "These two entities  Fannie Mae and Freddie Mac  are not facing any kind of financial crisis," said Representative Barney Frank of Massachusetts, the ranking Democrat on the Financial Services Committee. "The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." Last updated:  2 October 2008    Sources:   Holmes, Steven A.  "Fannie Mae Eases Credit to Aid Mortgage Lending."   The New York Times.  30 September 1999.    Labaton, Stephen.  "New Agency Proposed to Oversee Freddie Mac and Fannie Mae."   The New York Times.  11 September 2003. In November 2015, the biography of Frederick Trump, Donald Trump's grandfather, was condensed into two paragraphs and then passed around the internet via a meme. While some of the information included in the meme is accurate, much of it is either over-exaggerated or incomplete:  This particular rumor centers on the idea that Frederich Trump made his fortune via brothels and opium dens. While there is anecdotal evidence that Trump dabbled in prostitution, there is no proof that this made up the bulk of his fortune. In Gwenda Blair's 2000 book The Trumps: Three Generations of Builders and a Presidential Candidate, she described how Frederick Trump opened a series of restaurants and hotels during the Klondike Gold Rush in the 1890s. One of those hotels, The Arctic Restaurant and Hotel, was described as decadent and far superior to other restaurants in the area: book In the larder was salmon and an extraordinary variety of meats, including duck, ptarmigan, grouse, goose, and swan, as well as caribou, moose, goat, sheep, rabbit, and squirrel. Incredibly, the New Arctic served fresh fruit: red currants, raspberries, strawberries, blueberries, blackberries, even cranberries. A small oasis of luxury, the Arctics menu was a vast improvement over what the two restaurateurs had been able to offer on the trail. An anonymous letter to the Yukon, however, claimed that The Arctic Restaurant and Hotel was also known for prostitution: I would advise respectable women traveling alone, or with an escort, to be careful in their selection of hotels at Bennett, he wrote. For single men the Arctic has excellent accommodations as well as the best restaurant in Bennett, but I would not advise respectable women to go there to sleep as they are liable to hear that which would be repugnant to their feelings  and uttered, too, by the depraved of their own sex. While it's unclear if Frederich Trump directly profited from prostitution at his hotel (or whether it even occurred there), it should be noted that the world's oldest profession was relatively commonplace during the Gold Rush. The meme also claims that Frederick Trump decided to go back to Germany when police started cracking down on "his criminal rackets." Again, this is based on little more than a morsel of truth, and does not tell the whole story. In 1901, Trump sold his assets and returned to Germany. While one could argue that Trump made the decision because he believed that police were going to start enforcing prostitution laws, that is only one factor that led to Trump's departure for Germany: Frederick Trump saw that it was time to leave. If Major Wood actually enforced the laws regarding prostitution, gambling, and liquor, hotels and restaurants would be far less profitable. Not only that, the economic boom was bound to be short lived. There was not nearly enough solid economic development to absorb these newcomers in any long-term way; when the placer deposits were emptied, they would go back home. Without the umbrella of gold, other local industries would not be strong enough to keep going on their own and compete with cheaper sources farther south. The boom was over, Frederick Trump realized... ... Frederick Trump left just in time. He avoided the uproar when his erstwhile partner hit the skids, and he avoided the economic decline that would soon sweep over White Horse. Once again, in a situation that created many losers, he managed to emerge a winner. He had made money; perhaps even more unusual in the Yukon, he had also kept it and departed from White Horse with a substantial nest egg. He had accomplished this goal of making and saving enough money to marry. But he had no intention of doing so in America. For this important moment, he would have to return to Germany. While the meme exaggerated Trump's involvement in "criminal rackets," it did correctly state that Trump returned to the United States after the German government determined that he had originally left Germany in 1885 to avoid taxes and the army. returned In summation, Donald Trump's grandfather Frederick Trump was a German immigrant who made his fortune by opening several restaurants and hotels in Seattle and British Columbia during the Yukon Gold Rush. While some of these hotels may have been used for prostitution, gambling, or other seedy activities common on the trail, it is incorrect to say that Trump built his fortune on illegal activities. Grier, Peter.  "Donald Trump: The Son of an Immigrant."
  The Christian Science Monitor.  24 August 2015. Blair, Gwenda.  The Trumps: Three Generations of Builders and a Presidential Candidate.
  Simon and Schuster, 2000.  ISBN 0-684-80849-8.