Was Amazon exempt from paying federal income taxes in 2017?
Amid national debates about income inequality and tax cuts for the ultra-rich, one talking point is frequently highlighted in online memes and by political figures such as Bernie Sanders is that online retailing giant Amazon.com, despite taking in $5.6 billion in profit in 2017, paid no federal corporate income taxes for that year: Bernie Sanders   (With respect to the claim about Amazon employees on welfare, see our fact check on that topic here.) here In regards to U.S. federal income taxes, the claim that Amazon paid none in 2017 is almost certainly factual. While Amazons tax filings are not public, their SEC filing for the year 2017 illustrates that the company used the tax code expertly (and legally) to their advantage, so well that the company anticipated a $137 million tax refund from the federal government (numbers are in millions of dollars): SEC filing   Amazon did pay taxes to individual U.S. states ($211 million) and to international jurisdictions ($724 million), but their federal income tax burden was (less than) zero. The filings indicate that two factors provided the lion share of Amazons reduced federal tax liability: $220 million worth of tax credits, and $917 million in tax-deductible executive pay derived from the sale of stocks:   The third negative item in the SEC filing, $789 million in reduced tax burden as a result of the 2017 Tax Act, will be applied to future tax years, according to a report from the Institute on Taxation and Economic Policy. report SEC filings do not require a company to list the specific credits they utilize, but there are several avenues Amazon would likely have pursued. Annette Nellen, a professor and director of the Master of Science in Taxation program at San Jose University, said that Amazons write-offs likely include credits for research and development, domestic production, and equipment depreciation. And according to a report from the Economic Policy Institute, Amazon receives myriad tax incentives from state and local governments as well: said report The expansion of Amazons physical distribution network has coincided with a strategic business plan of negotiating millions in tax abatements, credits, exemptions, and infrastructure assistance from state and local governments in the name of regional economic development. By the end of 2016, Amazon had likely received over $1 billion in state and local subsidies for its facilities, which would include not only fulfillment centers but sortation centers that only sort packages, mailing centers, and other facilities. Publicly-traded corporations can list the stock options they grant to employees as a business cost in their accounting, and if an option-receiving employee makes over $1 million a year in salary, the profits from the sale of those stocks can be then counted as a federal income tax deduction for the corporation (primarily due to a Clinton-era compromise over how to cap executive pay). Stock options allow an employee to purchase stock in their employers company at a set price, regardless of its current market value: list Options give executives and investors the right to buy shares of a company at a later date and at specific prices. For example, if a chief executive joins a media company when its stock is trading at $55 a share, but years later, the share price has skyrocketed to $100, that chief executive can still buy the shares at $55, pocketing the massive difference. In the cases of their highest paid employees, Amazon and other companies are able to deduct the massive difference employees make when they sell that stock at a profit. According to the Center for Tax Justice, because companies typically low-ball the estimated values, they usually end up with much bigger tax write-offs than the amounts they deduct as a 'cost' in computing the profits they report to shareholders. The $917 million in stock-based compensation listed in Amazon's SEC filing likely stems from their top employees' cashing in on their stock options for a large profit. deduct While it is impossible to know the exact amount of money Amazon did or did not pay to the federal government in 2017, their own accounting suggests that they expected their federal corporate income tax burden to be negative that year.  U.S. Securities and Exchange Commission.  Amazon.com Inc. Form 10-K"
  2 February 2018.
 Gardner, Mathew.  "Amazon Inc. Paid Zero in Federal Taxes in 2017, Gets $789 Million Windfall from New Tax Law."
  Institute on Taxation and Economic Policy.  13 February 2018.
 Tobias, Manuela.  "Bernie Sanders Says Amazon Paid No Federal Income Tax in 2017. He's Right."
  Politifact.  3 May 2018. 
 Jones, Janell and Ben Zipperer.  "Unfulfilled Promises."
  Economic Policy Institute.  1 February 2018. 
 Gunjan, Banerji.  "Potential Loser in Tax Overhaul: Executive Stock Options."
  The Wall Street Journal.  19 December 2017.
 Citizens for Tax Justice.  Fortune 500 Corporations Used Stock Option Loophole to Avoid $64.6 Billion in Taxes Over the Past Five Years."
  9 June 2016.
On 7 April 2017 multiple web sites reported that President Trump owned stock in defense contractor Raytheon (RTN), thereby standing to personally profit from a U.S. military action strike he ordered that had launched some 59 Tomahawk missiles at a Syrian air base the previous day. (Those missiles have an estimated replacement cost of $60 million.) profit replacement cost The headline in one of the more prominent articles of that nature held that "Trump owns stock in the Tomahawk missiles he used in Syria," although the body of the article only averred that Trump had once owned stock in Raytheon: headline In other words Trump just set a bunch of Tomahawk missiles on fire which, according to a recent Defense Department report, may have been worth as much as $93.8 million in total. Why would he do this? Well, he does own shares of stock in the company that makes the Tomahawks. Tomahawk missiles are manufactured by Raytheon Inc., and according to [a] report from Business Insider, Donald Trump owned stock in Raytheon up through at least the start of the presidential election cycle. There is no record that he subsequently sold that stock. Cited at least two links away from that article was a 15 July 2015 Federal Election Committee (FEC) document disclosing then-candidate Donald Trump's financial holdings prior to his election. Page 37 of that 2015 disclosure report listed Raytheon as one of Trump's assorted smaller holdings in 2015: two document  Line 23 of that July 2015 form also disclosed that that portion of Donald Trump's portfolio had a value of between $1,001 and $15,000 and brought him $201 or less in income:   Newer FEC disclosure forms for President Trump are available, including a similar May 2016 report: The 2016 Raytheon holding was reported as being within the same value range previously stated (i.e., between $1,001 and $15,000), but the listed income derived from it was slightly higher ($1,001 to $2,500):   If the stated holdings are accurate, it doesn't appear that President Trump stood to directly gain much, in anything (especially relative to his extant wealth), from Raytheon's market gain following the Syrian attack. According to MarketWatch, several other defense stocks also experienced modest bumps in their value immediately after the event: value Raytheon RTN, +0.25% the maker of the Tomahawk missiles that were used in the attack, was last up 0.8%, after jumping more than 3% in the premarket to lead S&P 500 gainers. Another defense stock, Lockheed Martin Corp. LMT, +0.28% rose 0.9%. L3 Technologies Inc. LLL, +1.78% gained 1.4% and Harris Corp. HRS, +0.62% was up 0.9%. General Dynamics Corp. was up 0.8% and Northrop Grumman Corp. NOC, +0.90% was up 0.7%.  A critical long-form piece published by the Atlantic examined President Trump's putative financial conflicts of interest in depth but did not mention Raytheon. examined Rumors that Donald Trump stood to profit off Raytheon stock due to the Syrian missile strike of 7 April 2017 were not the first of their kind. In November 2016, then-President Elect Trump was rumored to be profiting off Energy Transfer Partners's (ETP) Dakota Access Pipeline (completion of which he green-lighted as president), and in December 2016 he was said to hold stock in Carrier (with whom he had just negotiated a pre-inaugural deal). Trump spokesperson Hope Hicks asserted the President Elect sold off his minor stakes in ETP in mid-2016, and Trump's 2016 Personal Financial Disclosure did not include a listing for stock in United Technologies (Carrier's parent corporation). Dakota Access Pipeline Carrier asserted The White House has not responded to our request for comment on President Trump's defense stock holdings. Linnane, Ciara.  "Tomahawk Maker Raytheon, Defense Stocks Retreat from Highs Fueled by Syrian Strike."
  MarketWatch.  7 April 2017. Mufson, Steven.  "Trump Dumped His Stock in the Dakota Access Pipeline Owner Over the Summer."
  The Washington Post.  23 November 2016. Murphy, Olive.  "Trump Caught Profiting from Missiles Used in Syria  Stock Price Skyrockets."
  Bipartisan Report.  7 April 2017. Palmer, Bill.  "Donald Trump Owns Stock in the Tomahawk Missiles He Used in Syria."
  Palmer Report.  7 April 2017. Terrarosa, Tom.  "How Raytheon Really Stands to Gain from U.S. Missile Attack."
  TheStreet.  7 April 2017. Venook, Jeremy.  "Donald Trumps Conflicts of Interest: A Crib Sheet."
  The Atlantic.  7 April 2017. Walker, Hunter and Myles Udland.  "Here's What's In Donald Trump's Stock Portfolio."
  Business Insider.  22 July 2015. Walker, Hunter.  "Donald Trump Personal Financial Disclosure Report."
  Scribd.  22 July 2015  (page 37). The Dallas Morning News.  "Donald Trump Form 278E Disclosure 2016."
  14 June 2016  (page 37). False accusations alleging protesters at confirmation hearings for U.S. Supreme Court nominee Brett Kavanaugh were paid as part of a nefarious liberal conspiracy to block his confirmation resulted in intense harassment for two people whose images were posted online along with misleading information. Internet trolls widely shared a photograph of demonstrator Vickie Lampron being handed cash by an organizer while she waited to enter the U.S. Capitol, where she would be one of the first persons to be arrested protesting at the Senate Judiciary Committee hearing for Kavanaugh on 4 September 2018. Although she was merely given a small amount of cash so she could pay post and forfeit fines, conspiracy theorists falsely claimed a photograph of her was evidence that protesters were paid for personal gain in exchange for disrupting the hearings.The picture was originally posted by self-described international conference speaker Adam Schindler to his eponymous website and to Twitter. He also made a YouTube video in which three of his friends claimed to have witnessed "paid political operatives" in action:Proof the protestors were paid off in line. #Kavanaugh #ConfirmKavanaugh #ActivismInAction pic.twitter.com/hMLpP4zWPn Adam W. Schindler (@AdamSchindler) September 4, 2018Theyre back at it today. Exercising free speech. pic.twitter.com/K7GPFCeusM Adam W. Schindler (@AdamSchindler) September 5, 2018The first image was also widely shared on Facebook with the following caption: "This woman disrupted the Kavanaugh hearing held on September 4 and was thrown out. A few minutes later someone got a photo of her being paid."While it's true the photograph indeed shows Lampron being given money, she wasn't being paid a fee in exchange for protesting. The man wearing a backpack in the photograph is Vinay Krishnan, a consultant who helps organize legal support for the progressive activist organization Center for Popular Democracy (an organization that has been heavily involved in organizing protests against Kavanaugh's confirmation).Krishnan told us the money was raised via small donations from around the country, and protesters were given about $35 to pay related fees in the event they were arrested; if they weren't arrested, the money was to be returned."These protesters are coming from across the country believing they are fighting for their very right to exist in this country," he told us. "Thats why theyre there. Not for $35 which they returned immediately if they didn't give it to D.C. Capitol Police."Both Lampron and Krishnan faced online harassment as a result of the misinformation spread online about them. Krishnan received racially-tinged death threats, forcing him to close down his social media accounts, and a laundromat that had offered Lampron a job reportedly rescinded the offer as a result of the controversy.Vickie Lampron declined to be interviewed for this story, so we spoke instead to Shay Totten, spokesman for the Vermont activist organization Rights and Democracy, of which Lampron is a member. Totten told us:Vickie is not a paid protester. She felt very strongly that she wanted to go to D.C. on behalf of herself and her granddaughters because she feared she was seeing women's rights on the line when it came to this Supreme Court nomination. We fundraised to send our members down so they dont have to pay out of pocket. But they dont make any money.Adam Schindler's tweets and video were picked up and widely shared by a large number of social media users and junk news sites, including the Gateway Pundit (which incorrectly referred to Schindler as a "reporter"), Your News Wire, and conspiracy trolling site Infowars.RealClearPolitics meanwhile ran with the headline "Three Texas Doctors: We Saw Protesters Paid in Cash to Disrupt Brett Kavanaugh Hearing on Line to Enter." (We reached out to both Schindler and RealClearPolitics publisher Tom Bevan about their posts but received no response.)The images of a "paid protester" have popped up repeatedly since the 4 September hearing in the service of false claims that Kavanaugh's confirmation process was being picketed for profit instead of principle.A detail that many junk sites failed to pick up on was that the same day Schindler published his posts claiming to have witnessed the paying of protesters, he began walking those same claims back:Spoke to the protest organizer. She confirmed handing out cash, but said they intend cash to be used to pay fines they know come when protestors break the law. A small price to pay to be heard I suppose. #KavanaughConfirmation Adam W. Schindler (@AdamSchindler) September 5, 2018On 6 September 2018, Schindler authored a blog post recounting his discussion with organizers from the activist group:I went back to the public ticket line mid-afternoon and approached the gentleman from the photos. I greeted him and the moment he saw me he hurried away. A woman sitting on the bench saw this and stepped in. She identified herself as Jennifer (Flynn Walker), the protest organizer from a group called Center for Popular Democracy. We had a very civil discussion about what they were doing and why.I made an audio recording of this conversation and it is posted in its entirety below. I have also transcribed some key moments in the conversation and posted them below.During our 12 minute discussion, a half dozen protestors gathered around and some participated. The gentleman in the photos did not. The protest leader confirmed her group was providing cash to protestors. She took issue with my use of the term payment, saying the provided cash was only to be used to pay the fines. I was unclear how she was able to enforce this vital distinction for her. But nonetheless, she, and the half dozen members surrounding us, all confirmed her group was giving cash to protestors.She then asked if I was interested in knowing the source of her cash. She had good instincts! I didnt even have to ask. I could sense her pride as she told an emotional story about how it was crowdsourced from donors across the nation. I asked if that was the only source of funding for this protest. I had no reason to doubt the truthfulness of her story. But I did doubt it was the only source of funds. She was quick to ask a clarifying question before answering, as her organization is funded with tens of millions of dollars from George Soros. A fact Im sure she was familiar with. But she said very precisely, Thats how we pay for the fines, yes. And that was that.Billionaire philanthropist George Soros contributes large sums of money toward progressive causes (the Center for Popular Democracy does receive funding from Soros, for example). He is also the boogeyman in many right-wing conspiracy theories that often veer into anti-Semitism, in which he is typically portrayed as a puppet master orchestrating a vague world take-over.We found no evidence, however, to support the claim that Soros was directly paying out money to Kavanaugh hearing protesters, nor did we find evidence to support accusations that persons demonstrating at the hearings were there because they were being paid to protest.  Internet trolls widely shared a photograph of demonstrator Vickie Lampron being handed cash by an organizer while she waited to enter the U.S. Capitol, where she would be one of the first persons to be arrested protesting at the Senate Judiciary Committee hearing for Kavanaugh on 4 September 2018. Although she was merely given a small amount of cash so she could pay post and forfeit fines, conspiracy theorists falsely claimed a photograph of her was evidence that protesters were paid for personal gain in exchange for disrupting the hearings. first post and forfeit The picture was originally posted by self-described international conference speaker Adam Schindler to his eponymous website and to Twitter. He also made a YouTube video in which three of his friends claimed to have witnessed "paid political operatives" in action: website video Proof the protestors were paid off in line. #Kavanaugh #ConfirmKavanaugh #ActivismInAction pic.twitter.com/hMLpP4zWPn #Kavanaugh #ConfirmKavanaugh #ActivismInAction pic.twitter.com/hMLpP4zWPn  Adam W. Schindler (@AdamSchindler) September 4, 2018 September 4, 2018  Theyre back at it today. Exercising free speech. pic.twitter.com/K7GPFCeusM pic.twitter.com/K7GPFCeusM  Adam W. Schindler (@AdamSchindler) September 5, 2018 September 5, 2018 The first image was also widely shared on Facebook with the following caption: "This woman disrupted the Kavanaugh hearing held on September 4 and was thrown out. A few minutes later someone got a photo of her being paid."   While it's true the photograph indeed shows Lampron being given money, she wasn't being paid a fee in exchange for protesting. The man wearing a backpack in the photograph is Vinay Krishnan, a consultant who helps organize legal support for the progressive activist organization Center for Popular Democracy (an organization that has been heavily involved in organizing protests against Kavanaugh's confirmation). Krishnan told us the money was raised via small donations from around the country, and protesters were given about $35 to pay related fees in the event they were arrested; if they weren't arrested, the money was to be returned. "These protesters are coming from across the country believing they are fighting for their very right to exist in this country," he told us. "Thats why theyre there. Not for $35 which they returned immediately if they didn't give it to D.C. Capitol Police." Both Lampron and Krishnan faced online harassment as a result of the misinformation spread online about them. Krishnan received racially-tinged death threats, forcing him to close down his social media accounts, and a laundromat that had offered Lampron a job reportedly rescinded the offer as a result of the controversy. Vickie Lampron declined to be interviewed for this story, so we spoke instead to Shay Totten, spokesman for the Vermont activist organization Rights and Democracy, of which Lampron is a member. Totten told us: Vickie is not a paid protester. She felt very strongly that she wanted to go to D.C. on behalf of herself and her granddaughters because she feared she was seeing women's rights on the line when it came to this Supreme Court nomination. We fundraised to send our members down so they dont have to pay out of pocket. But they dont make any money. Adam Schindler's tweets and video were picked up and widely shared by a large number of social media users and junk news sites, including the Gateway Pundit (which incorrectly referred to Schindler as a "reporter"), Your News Wire, and conspiracy trolling site Infowars. users Gateway Pundit Your News Wire Infowars RealClearPolitics meanwhile ran with the headline "Three Texas Doctors: We Saw Protesters Paid in Cash to Disrupt Brett Kavanaugh Hearing on Line to Enter." (We reached out to both Schindler and RealClearPolitics publisher Tom Bevan about their posts but received no response.) RealClearPolitics The images of a "paid protester" have popped up repeatedly since the 4 September hearing in the service of false claims that Kavanaugh's confirmation process was being picketed for profit instead of principle. popped up repeatedly A detail that many junk sites failed to pick up on was that the same day Schindler published his posts claiming to have witnessed the paying of protesters, he began walking those same claims back: Spoke to the protest organizer. She confirmed handing out cash, but said they intend cash to be used to pay fines they know come when protestors break the law. A small price to pay to be heard I suppose. #KavanaughConfirmation #KavanaughConfirmation  Adam W. Schindler (@AdamSchindler) September 5, 2018 September 5, 2018  On 6 September 2018, Schindler authored a blog post recounting his discussion with organizers from the activist group: authored I went back to the public ticket line mid-afternoon and approached the gentleman from the photos. I greeted him and the moment he saw me he hurried away. A woman sitting on the bench saw this and stepped in. She identified herself as Jennifer (Flynn Walker), the protest organizer from a group called Center for Popular Democracy. We had a very civil discussion about what they were doing and why. I made an audio recording of this conversation and it is posted in its entirety below. I have also transcribed some key moments in the conversation and posted them below. During our 12 minute discussion, a half dozen protestors gathered around and some participated. The gentleman in the photos did not. The protest leader confirmed her group was providing cash to protestors. She took issue with my use of the term payment, saying the provided cash was only to be used to pay the fines. I was unclear how she was able to enforce this vital distinction for her. But nonetheless, she, and the half dozen members surrounding us, all confirmed her group was giving cash to protestors. She then asked if I was interested in knowing the source of her cash. She had good instincts! I didnt even have to ask. I could sense her pride as she told an emotional story about how it was crowdsourced from donors across the nation. I asked if that was the only source of funding for this protest. I had no reason to doubt the truthfulness of her story. But I did doubt it was the only source of funds. She was quick to ask a clarifying question before answering, as her organization is funded with tens of millions of dollars from George Soros. A fact Im sure she was familiar with. But she said very precisely, Thats how we pay for the fines, yes. And that was that. Billionaire philanthropist George Soros contributes large sums of money toward progressive causes (the Center for Popular Democracy does receive funding from Soros, for example). He is also the boogeyman in many right-wing conspiracy theories that often veer into anti-Semitism, in which he is typically portrayed as a puppet master orchestrating a vague world take-over. boogeyman We found no evidence, however, to support the claim that Soros was directly paying out money to Kavanaugh hearing protesters, nor did we find evidence to support accusations that persons demonstrating at the hearings were there because they were being paid to protest. Schindler, Adam.  "Story Behind Kavanaugh 'Paid Protesters.'
  AdamSchindler.com.  6 September 2018. Hulse, Carl.  "A New Reality for Court Confirmations: Pandemonium, Protesters and Partisanship."
  The New York Times.  4 September 2018. Brown, Emma. "California Professor, Writer of Confidential Brett Kavanaugh Letter, Speaks Out About Her Allegation of Sexual Assault."
  The Washington Post  16 September 2018. An article of faith among U.S. conservatives of the Cold War era stated that the Soviets aimed to destroy America from within by promoting a program of "creeping socialism," by which they meant the gradual replacement of democratic, free-market institutions with centralized government control. Never mind that the communists themselves subscribed to a different version of the end of free-market economies, namely Marx's theory that capitalism contained the seeds of its own destruction, an end which he argued was inevitable and would culminate in a socialist revolution. theory Regardless, conservative icons such as Ronald Reagan and Barry Goldwater saw creeping socialism in every piece of progressive legislation that came around the pike, from Roosevelt's New Deal to Medicare to LBJ's Great Society social-welfare programs of the mid-1960s. They further claimed that at least one Soviet leader, Nikita Khrushchev, had explicitly announced the regime's intent to export "small doses" of socialism to the U.S. in a statement he allegedly made in 1959. Reagan was fond of quoting this supposed pronouncement in speeches he gave as a crusader for conservative causes before launching his own political career later in the '60s. This instance is from an address he delivered in 1961: address The communists are supremely confident of victory. They believe that you and I, under the constant pressure of the Cold War, will one by one give up our democratic traditions and principles and customs. Only temporarily, of course, but only temporarily we will turn to totalitarian tactics and methods just for the purpose of opposing the enemy. And then they cynically believe we will one day awake to find that we have, in adopting these tactics, become so much like the enemy that the causes for conflict have disappeared between us. Three and a half months before his last visit to this country, Nikita Khrushchev said, "We can't expect the American people to jump from capitalism to communism but we can assist their elected leaders in giving them small doses of socialism until one day they will awaken to find they have communism." Variants of this passage also appeared in newspaper opinion columns, letters to the editor, and even political ads portraying Democratic Party candidates as enemies of freedom. This example is from the Muncie, Indiana, Star Press of 5 November 1960:   Fast-forwarding to some 56 years later, we find the same quote being deployed against Democrats of today, only now in the preferred venue of social media: "giving Americans small doses of socialism until they suddenly awake to find they have communism."-Nakita Khrushchev pic.twitter.com/mQVfhYvaNo pic.twitter.com/mQVfhYvaNo  Susan Minor (@susanminor41) April 14, 2016 April 14, 2016 The authenticity of the quote was questioned practically from the get-go, however. In 1962, Sen. Lee Metcalf (D-Montana) assailed it as "a fabrication, attributed to the leader of the Communist Party, (which) arouses Americans against their elected officials." Metcalf told the Los Angeles Times that the quote was being circulated by organizations including the far-right John Birch Society, which operated a bookstore called Poor Richard's Book Shop in Hollywood: [Metcalf] said the statement has been printed on post cards distributed by Coast Federal Savings & Loan Assn. and Poor Richard's Book Shop, both of Los Angeles, but that the Central Intelligence Agency, the Federal Bureau of Investigation and the Library of Congress have all been unable to verify the quotation. Metcalf said such material leads readers "to believe that their President, their senators, their representatives, their judges and local officials are Communist stooges. Thus a lie is used to perpetrate a greater lie." The Times reported that the president of Coast Federal Savings & Loan, Joe Crail, claimed responsibility for printing the postcards but admitted he couldn't authenticate the quote and said the campaign had been discontinued for that reason. Similarly, Sen. Morris K. Udall (D-Arizona) recruited the Library of Congress to verify the authenticity of the statement attributed to Khrushchev and shared the results in the 10 May 1962 issue of The New Republic: issue "We have searched the Legislative Reference Service files, checked all the standard reference works on quotations by Khrushchev, and consulted with the Slavic division of the Library of Congress, the Department of State, and the US Information Agency, in an attempt to determine the authenticity of this quotation. From none of these sources were we able to produce evidence that Khrushchev actually made such a statement." All that supposedly changed four years later when a witness came forward to claim that Khrushchev had uttered those very words in his presence. Ezra Taft Benson, who served two terms as President Eisenhower's Secretary of Agriculture and would later head the Church of Jesus Christ of Latter-day Saints, said in a 1966 address at Brigham Young University (BYU) that Khrushchev made the statement during a one-on-one discussion the two had in September 1959: address I have talked face-to-face with the godless Communist leaders. It may surprise you to learn that I was host to Mr. Khrushchev for a half day, when he visited the United States. Not that Im proud of it -- I opposed his coming then and I still feel it was a mistake to welcome this atheistic murderer as a state visitor. But according to President Eisenhower, Khrushchev had expressed a desire to learn something of American agriculture, and after seeing Russian agriculture I can understand why. As we talked face-to-face, he indicated that my grandchildren would live under Communism. After assuring him that I expected to do all in my power to assure that his, and all other grandchildren, would live under freedom, he arrogantly declared, in substance: You Americans are so gullible. No you wont accept Communism outright, but well keep feeding you small doses of socialism until youll finally wake up and you find you already have Communism. We wont have to fight you. Well so weaken your economy until you fall like over-ripe fruit into our hands. Such a meeting did occur, documents show, but Benson's 1966 account of their exchange on communism raises more questions than it answers. Benson had cited versions of the same quote on more than one occasion prior to 1966 without claiming that Khrushchev said it in his presence. Like Ronald Reagan routinely did during the same period, Benson told audiences that the Soviet premier made the remark before, not during, his 1959 visit to the United States. Benson presented it as follows in an August 1961 commencement address at BYU (from a report in the Provo Daily Herald, emphasis added): The Communist strategy, said the speaker, was laid down by Nikita Khrushchev three weeks before he visited the United States when he was quoted as making this statement: "We cannot expect the Americans to jump from capitalism to communism, but we can assist their elected leaders in giving Americans small doses of socialism, until they suddenly awake to find they have communism." "For years LDS Church leaders have warned against such a development, Elder Benson said. He introduced the quote more or less the same way in a book he wrote the following year (1962) called The Red Carpet: Socialism -- The Royal Road to Communism (emphasis added): A few months before coming to the United States Khrushchev is reported to have said: "We cannot expect the Americans to jump from capitalism to communism, but we can assist their elected leaders in giving Americans small doses of socialism, until they suddenly awake to find they have communism." The three different versions of the story don't jibe. Did Khrushchev utter the remark three weeks before visiting the U.S., a few months before, or did he utter it during a face-to-face meeting with Benson on U.S. soil? Why did Benson write in 1962 (three years after Khrushchev's visit) that the Soviet premier was "reported" to have said it? Why was there no mention before 1966 of Khrushchev's saying it to his face? Unfortunately, Ezra Taft Benson died in 1994, so we can't ask him. Nor, as far as we know, has any third-party witness to the alleged exchange ever come forward. Far from settling the question of whether Khrushchev really vowed to slip Americans "small doses of socialism," Benson's conflicting stories leave the authenticity of the remark very much in doubt. We should also mention, in passing, that U.S. conservatives were sounding alarms about Americans being plied with "small doses of socialism" long before Khrushchev attained the premiership of the Soviet Union. This is National Association of Manufacturers President Claude A. Putnam speaking in April 1950 (as reported in the Times Herald of Olean, New York): Socialism "is being foisted on the American people piecemeal," says Claude A. Putnam of Keene, N.H., president of the National Association of Manufacturers. Putnam, who spoke here, warned that an "all-powerful government is a menace to freedom." The American people "are being given small doses of socialism, disguised as social gains and gifts of something for nothing," he declared. If we've learned nothing else in the roughly 60 years of its existence, the durability of the Khrushchev quote shows that a politically charged statement needn't be authenticated to serve its purpose as a partisan cudgel. As if to prove the point, the quote was tweeted out to 70,000 followers as recently as February 2018 by none other than Michael Reagan, Ronald Reagan's son: We cannot expect the Americans to jump from capitalism to communism, but we can assist their elected leaders in giving Americans small doses of socialism, until they suddenly awake to find they have communism."-- Nikita Khrushchev  Michael Reagan (@ReaganWorld) February 18, 2018 February 18, 2018 Benson, Ezra Taft.  "Our Immediate Responsibility."
  Latter Day Conservative.  25 October 1966. Jeffries, Stuart.  "Karl Marx's Guide to the End of Capitalism: A Primer."
  The Guardian.  20 October 2008. Reagan, Ronald.  "Encroaching Control."
  The Reagan Speech Preservation Society.  30 March 1961. Udall, Morris K.  "Khrushchev Could Have Said It."
  The New Republic.  7 May 1962. The Daily Herald.  "542 Receive Degrees at BYU Rites."
  27 August 1961. The Los Angeles Times.  "Right-Wingers Hit on 'Quote' by Khrushchev."
  9 March 1962. Times Herald.  "Keene Warns Against Spread of Socialism."
  14 April 1950. Claim:  John McCain said he would define the income level that divides the middle class from the rich as $5 million. Status:  True. Example:   [Collected via e-mail, September 2008] I have heard many times that John McCain said (paraphrasing his comment, I'm sure) that the middle class includes people who make under $5 million. I am trying to find that IN PRINT to forward to relatives who say it is untrue. Origins:  On 16 August 2008, presidential candidates Barack Obama and John McCain made back-to-back appearances at the Presidential Candidates Forum held at the Saddleback Church in Lake Forest, California, where they responded to questions posed to them by Pastor Rick Warren.  During that forum, Pastor Warren asked both candidates to define "rich" for the purposes of taxation (although, since the candidates appeared separately, the question was not posed to both of them with the same wording). Presidential Candidates Forum To Democratic candidate Barack Obama, Pastor Warren said: "OK. Taxes, this is a real simple question. Define rich. I mean give me a number, Is it $50,000, $100,000, 200,000? Everybody keeps talking about who we're going to tax. How can you define that?"  Senator Obama didn't quite answer the question directly, saying that an income level of less than $150,000 per year was middle class and that his tax plan would call for a "modest increase" in taxes for those making more than $250,000 per year: Look, the  here's how I think about it. Here's how I think about it. And this is reflected in my tax plan. If you are making $150,000 a year or less, as a family, then you're middle class or you may be poor. But $150,000 down you're basically middle class, obviously depends on the region where you're living. I would argue that if you're making more than $250,000, then you're in the top three percent, four percent of this country. You're doing well. Now, these things are all relative. And I'm not suggesting that everybody is making over $250,000 is living on easy street. But the question that I think we have to ask ourselves is, if we believe in good schools, if we believe in good roles, if we want to make sure that kids can go to college, if we don't want to leave a mountain of debt for the next generation. Then we've got to pay for these things, they don't come for free, and it is irresponsible. I believe it is irresponsible intergenerationally for us to invest or for us to spend $10 billion a month on a war and not have a way of paying for it. That, I think, is unacceptable. So nobody likes to pay taxes. I haven't sold 25 million books but I've been selling some books lately, and so I write a pretty big check to Uncle Sam. Nobody likes it. What I can say is under the approach I'm taking, if you make $150,000 or less, you will see a tax cut. If you're making $250,000 a year or more, you're going to see a modest increase. What I'm trying to do is create a sense of balance, and fairness in our tax code. One thing I think we can all agree on, is that it should be simpler so that you don't have all these loopholes and big stacks of stuff that you've got to comb through, which wastes a huge amount of money and allows special interests to take advantage of things that ordinary people cannot take advantage of. To Republic candidate John McCain, Pastor Warren said: "Ok, on taxes, define 'rich.' Everybody talks about taxing the rich, but not the poor, the middle class. At what point  give me a number, give me a specific number  where do you move from middle class to rich? Is it $100,000, is it $50,000, is it $200,000? How does anybody know if we don't know what the standards are?"  Senator McCain responded by stating that he didn't think "rich" should be solely defined by income level and that the question was moot because he wanted cut spending rather than increase taxes on the rich; along the way he mentioned an income level of $5 million (immediately noting that "I'm sure that comment will be distorted"): Some of the richest people I've ever known in my life are the most unhappy. I think that rich should be defined by a home, a good job, an education and the ability to hand to our children a more prosperous and safer world than the one that we inherited. I don't want to take any money from the rich  I want everybody to get rich. I don't believe in class warfare or re-distribution of the wealth. But I can tell you, for example, there are small businessmen and women who are working 16 hours a day, seven days a week that some people would classify as  quote  "rich," my friends, and want to raise their taxes and want to raise their payroll taxes. Let's have  keep taxes low. Let's give every family in America a $7,000 tax credit for every child they have. Let's give them a $5,000 refundable tax credit to go out and get the health insurance of their choice. Let's not have the government take over the health care system in America. So, I think if you are just talking about income, how about $5 million? But seriously, I don't think you can  I don't think seriously that  the point is that I'm trying to make here, seriously  and I'm sure that comment will be distorted  but the point is that we want to keep people's taxes low and increase revenues. And, my friend, it was not taxes that mattered in America in the last several years. It was spending. Spending got completely out of control. We spent money in way that mortgaged our kids' futures. Although this item is "true" in the strictly literal sense that John McCain did make the remark attributed to him, how much importance to place upon it is a subjective issue. Predictably, Democrats painted Senator McCain's remarks as indicative of his being out of touch with ordinary Americans and desirous of giving tax breaks to the rich, while the McCain campaign dismissed the candidate's statement as an obvious joke. (A Democratic National Committee video spotlighted Senator McCain's "$5 million" statement while omitting the remarks that surrounded it; the full exchange in context can be viewed here.)  Meanwhile, economists asked to comment on the issue observed that the definition of "rich" is a murky one, and that the dividing line between "poor" and "middle class" (rather than between "middle class" and "rich") is probably the more significant one: video here Economists said in interviews that neither candidate was wrong because there are no agreed-upon definitions for the terms that describe income segments. "To be fair to both of them, 'rich' is an adjective," said James P. Smith, a senior economist at the Rand Corp., a nonpartisan think thank in Santa Monica. "Economic science is not going to tell you that 'this' is the cutoff point." Yet the $5-million level, Smith said, includes "almost nobody." Experts said that of all the households in the nation, fewer than one-tenth of 1% had an annual  income of $5 million or more. Ken Goldstein, an economist for the Conference Board, a business-research group based in New York, said he would define rich as income about $500,000 or more. "If you set the bar at half a million, you're talking about the top 1% of taxpayers. If you think about the last eight years, those are the folks who have benefited the most." Other economists said they would have gone with a lower figure. Even the moderator who asked the question of the candidates, Pastor Rick Warren of Orange County's Saddleback Church, did not seem to anticipate a reply beyond the lower six figures, urging each man to "give me a specific number ... is it 100,000 [dollars], is it 50, 200?" Most ordinary Americans tend to massage the definitions of such terms in an attempt to crowd themselves into what many consider the least offensive category. "If you do surveys, 95% of people think they are middle class," said Len Burman, director of the Tax Policy Center, a nonpartisan group that has analyzed the candidates' tax proposals. "This is including people who are objectively quite poor and people who are objectively quite rich." Burman added: "I guess it says something nice about America that rich people don't want to act like they're better than anybody else and poor people don't like complaining about how tough it is to pay their bills." Economists tend to spend more time debating the definition of poor, in large part because that cutoff has consequences for an array of social programs designed to assist those whose incomes fall below the poverty line. Last updated:  13 September 2008    Sources:   Miller, Greg.  "Who's Rich? McCain and Obama Have Very different Definitions."   Los Angeles Times.  18 August 2008.    Montopoli, Brian.  "DNC Looks to Exploit McCain's '$5 Million' Comment."   CBSNews.com.  19 August 2008.    Reuters.  "Obama Rips McCain for $5 Million 'Rich' Definition."   18 August 2008. Virus:  FBI vs. Facebook virus lure. Status:  Real. Example:   [Collected via e-mail, July 2008]  Origins:  The "FBI vs. Facebook" mailings are new lures for an existing virus (rather than a new form of virus), but since they've garnered so much attention, we've created this separate entry for them. The mailings, which began in July 2008, typically arrive with a subject line of "F.B.I. vs. Facebook" and include the text "F.B.I. Facebook Records" with a link to what appears to be a news site.  However, clicking through on the link will initiate the download of an malicious executable (fbi_facebook.exe) onto recipients' PCs, while something like the screen shot shown above displays to trick users into believing they're merely visiting an innocuous news site. All of this camouflage is cover for propagation of the Storm worm, a virus which has been around for a few years and has been spread via many guises.  Because this particular incarnation invokes the name and symbol of the Federal Bureau of Investigation (FBI), that agency has issued a press release to warn the public about the misleading  messages: Storm press release FBI Warns of Storm Worm Virus The FBI and its partner, the Internet Crime Complaint Center (IC3), have received reports of recent spam e-mails spreading the Storm Worm malicious software, known as malware. These e-mails, which contain the phrase "F.B.I. vs. facebook," direct e-mail recipients to click on a link to view an article about the FBI and  Facebook, a popular social networking website. The Storm Worm virus has also been spread in the past in e-mails advertising a holiday e-card link. Clicking on the link downloads malware onto the Internet connected device, causing it to become infected with the virus and part of the Storm Worm botnet.A botnet is a collection of compromised computers under the remote command and control of a criminal "botherder." Most owners of the compromised computers are unsuspecting victims. They have unintentionally allowed unauthorized access and use of their computers as a vehicle to facilitate other crimes, such as identity theft, denial of service attacks, phishing, click fraud, and the mass distribution of spam and spyware. Because of their widely distributed capabilities, botnets are a growing threat to national security, the national information infrastructure, and the economy. "The spammers spreading this virus are preying on Internet users and making their computers an unwitting part of criminal botnet activity. We urge citizens to help prevent the spread of botnets by becoming web-savvy. Following some simple computer security practices will reduce the risk that their computers will be compromised," said Special Agent Richard Kolko, Chief, FBI National Press Office. Everyone should consider the following:  Do not respond to unsolicited (spam) e-mail.  Be skeptical of individuals representing themselves as officials soliciting personal information via e-mail.  Do not click on links contained within an unsolicited e-mail.  Be cautious of e-mail claiming to contain pictures in attached files, as the files may contain viruses. Only open attachments from known senders.  Validate the legitimacy of the organization by directly accessing the organization's website rather than following an alleged link to the site.  Do not provide personal or financial information to anyone who solicits information.  Last updated:  6 August 2008    Sources:   Colker, David.  "Don't Open 'FBI vs. Facebook' E-Mail, Lest You Loose the Storm Worm."   Los Angeles Times.  3 August 2008.    Durkin, Mike.  "FBI vs Facebook Email Thread Has 'Storm Worm' Virus."    FOXNews.com.  30 July 2008. On June 28, 2022, we received reader mail informing us that scammers were using food blogger, author, and Food Network TV host Ree Drummond's image and likeness to sell supposed weight loss products or "dementia solutions" called Condor CBD Gummies, Truly Keto, and TrimClinical Keto. Drummond, also known as "The Pioneer Woman," was featured in several Facebook ads that claimed she had experienced a "tragic end," a tragedy, sad news or unspecified "allegations." These ads were nothing more than misleading clickbait and part of a scam. She never endorsed any CBD or keto gummies products or a "dementia solution." Food Network A reader who emailed us included a screenshot of one of the misleading ads. One of the ads read, "Her entire future is now in jeopardy! Fans feel sad about today's news. A tragic end today for Ree Drummond."  Another reader sent in a different ad that read, "Fans are up in arms over the allegations pending against Ree Drummond. Here is all the information available to the public at this moment."  These false clickbait Facebook ads were familiar territory. We've reported before on misleading, scammy tactics just like these that were used in other CBD and keto gummies scams. In reality, there were no "allegations" against Drummond, nor was there any brand new sad or tragic news about her. Facebook CBD keto We received a screenshot of the article that showed a picture of Drummond and her name. The article was misleadingly designed to mimic the Fox News website. Fox News had nothing to do with the scam. Drummond Fox News  The headline of the fake Fox News article read, "Ree Drummond reverses dementia solution, sparks huge lawsuit pressure on Fox, she finally fights back on air." This was basically the same CBD gummies scam that previously featured "Jeopardy" host Mayim Bialik. the same CBD gummies scam Mayim Bialik Meanwhile, a second article that was designed to look like the Time magazine website claimed, "Weight Loss Industry In Outrage Over Ree Drummond's Keto Formula That's Helping Millions Of Women & Even Men Melt Body Fat And Get Healthy Again In Memory Of Her Brother!" Just as with the fake Fox News article, this one also did not genuinely come from Time. We found these articles being hosted on j40ev2.com/h4Fhjee/, lirknluck.uk.com/tiram/index.html, and sgn394.com/7bn3lo9u/. The web domains may have been registered in China. Time magazine A third false article was created by scammers to mimic the "Today" TV show website and showed the headline, "Ree Drummond Forced To Lose 30 Pounds by 'Food Network' Producers She Lost 50! (Her Diabetes Finally In Control)." In our research, we located a number of scammy Facebook pages that mentioned Drummond's name with the words CBD or keto gummies. According to when several of the pages were created or had their previous names changed, it looked like this scam began no earlier than mid-June 2022. a number of scammy Facebook pages  We reached out to Hearst Digital Media to inform them of the scam. The publisher hosts "The Pioneer Woman" blog. We also requested a statement, which we will add to this story if we receive a response. scam blog In sum, there was no sad or tragic news or any "allegations" to report about Drummond, nor did "The Pioneer Woman" ever endorsed Condor CBD Gummies, Truly Keto, and TrimClinical Keto, or any other similar products for Fox News, Time, or "Today." The Pioneer Woman Note: If readers spot any CBD or keto gummies scams for celebrities other than Ree Drummond, please contact us. It's likely that scammers will switch to a different celebrity for the scam in future weeks. If possible, please include a direct link to the Facebook ad or to the page that's hosting the ad. Unlike a screenshot, a link will allow us to fully look into the matter. contact us Ree Drummond. Food Network, https://www.foodnetwork.com/profiles/talent/ree-drummond. The Pioneer Woman. Hearst Digital Media, https://www.thepioneerwoman.com/. On July 5, 2022, this article was updated with new details after a helpful reader located ads that falsely claimed Drummond had experienced "allegations" against her. Statistics from the Bureau of Labor Statistics indicate that New Mexico gained 75,800 jobs from December 2002 to July 2007, which is slightly lower than Richardson's claim. As our friends at FactCheck.org note in thisarticle, Richardson has consistently cited the higher number, even when the actual number was lower. For our ruling, however, we'll rely on the current 75,800 and call it mostly true. It's difficult to calculate how big a role his tax cuts played in getting businesses to create those jobs. James Peach, an economics professor at New Mexico State University, said many factors make a company decide to add jobs and that tax incentives often play only a modest role. Indeed, much of the job growth in the state began before Richardson became governor, Peach said. Still, Peach said Richardson's tax incentives and income tax cuts have created a favorable atmosphere for business that is a stark change from the state's mentality in the mid-1970s, when state officials refused to provide help to a promising young company named Microsoft. The climate here has changed considerably since then, Peach said. Bill Richardson has been a big part of that. He's not the whole story, but he's been a big part of it. A reader forwarded anemailto us in which state Rep. Senfronia Thompson urged a boycott of Macys department stores on the day after Thanksgiving 2013. The fact that Macy's doesn't support equal pay for women should stop you from shopping there on Black Friday, the Houston Democrat wrote, saying that her equal-pay proposal cleared the Legislature earlier this year, but then Macy's sent a letter to Rick Perry urging him to veto the law, which he ultimately did. Thompsons House Bill950was among 24 bills PerryvetoedJune 14, 2013. It would have created state law similar to 2009s federal Lilly Ledbetter Act, which gave plaintiffs more time to sue over pay discrimination in federal courts. AnAug. 6, 2013,news storyin theHouston Chroniclereported that Texas Retailers Association members including Macys and Krogers had written Perry in May asking him to kill the legislation because, they said, it would lead to open-ended litigation and duplicate federal law. Thompson spokeswoman Milda Mora told us by phone that the representative learned of the letters from theHouston Chroniclereporter in August and checked with the governors office, which provided her with copies that Moraemailedto us. One written on Macys letterhead (clickhereor scroll down to view it) concluded, The federal requirements under Lilly Ledbetter are unnecessary and would be harmful to Texas employers. We urge you to veto this legislation. Macys spokeswoman Bethany Charlton confirmed that her company sent the May 31, 2013, letter, which was signed by a company vice president. By email, Charlton said the company absolutely supports equal pay for equal work among men and women but believes existing laws provide strong remedies for discrimination. Perrys logic was similar: House Bill 950 duplicates federal law, which already allows employees who feel they have been discriminated against through compensation to file a claim with the U.S. Equal Employment Opportunity Commission, said his June 14, 2013,veto statement. Progress Texas, the pro-Democratic organization that distributed Thompsons email and is organizing theboycott,disputesPerrys statement that the bill would have duplicated federal law, saying that the Ledbetter protections need to be codified in state law for them to apply to cases in state courts. The groups executive director, Ed Espinoza, told us by email that his group launched a boycott of Macys and other retailers when the news broke in August. An Aug. 7, 2013,Chroniclenews blog postsaid Thompson took part in that boycott also, canceling a planned appearance at a Macys store to mark the states annual sales-tax holiday. Mora said that Thompson, who was quoted in an Aug. 9, 2013 Texas Public Radionews storyas saying she had previously been a card-packing member of Macys, but had not shopped there since the letters became public. Our ruling Thompson said Macy's sent a letter to Rick Perry urging him to veto her equal pay measure. As the Houston newspaper reported, Macys wrote the governor May 31, 2013, saying We urge you to veto this legislation. The claim is True. TRUE The statement is accurate and theres nothing significant missing. Click here formoreon the six PolitiFact ratings and how we select facts to check. Claim:  Notorious mob lawyer "Easy Eddie" O'Hare teaches his son Butch the value of honesty and integrity; the son goes on to become a decorated war hero and dies in the service of his country. Status:  Multiple  see below. Example:  [Collected on the Internet, 2000] During the course of World War II, many people gained fame in one way or another. One man was Butch O'Hare. He was a fighter pilot assigned to an aircraft carrier in the Pacific. One time his entire squadron was assigned to fly a particular mission. After he was airborne, he looked at his fuel gauge and realized that someone had forgotten to top off his fuel tank. Because of this, he would not have enough fuel to complete his mission and get back to his ship. His flight leader told him to leave formation and return. As he was returning to the mother ship, he could see a squadron of Japanese Zeroes heading toward the fleet to attack. And with all the fighter planes gone, the fleet was almost defenseless. His was the only opportunity to distract and divert them. Single-handedly, he dove into the formation of Japanese planes and attacked them. The American fighter planes were rigged with cameras, so that as they flew and fought, pictures were taken so pilots could learn more about the terrain, enemy maneuvers, etc. Butch dove at them and shot until all his ammunition was gone, then he would dive and try to clip off a wing or tail or anything that would make the enemy planes unfit to fly. He did anything he could to keep them from reaching the American ships. Finally, the Japanese squadron took off in another direction, and Butch O'Hare and his fighter, both badly shot up, limped back to the carrier. He told his story, but not until the film from the camera on his plane was developed, did they realize the extent he really went to, to protect his fleet. He was recognized as a hero and given one of the nation's highest military honors. And as you know, the O'Hare Airport was also named after him. Prior to this time in Chicago, there was a man named Easy Eddie. He was working for a man you've all heard about, Al Capone. Al Capone wasn't famous for anything heroic, but he was notorious for the murders he'd committed and the illegal things he'd done. Easy Eddie was Al Capone's lawyer, and he was very good. In fact, because of his skill, he was able to keep Al Capone out of jail.  To show his appreciation, Al Capone paid him very well. He not only earned big money, he would get extra things, like a residence that filled an entire Chicago city block. The house was fenced, and he had live-in help and all of the conveniences of the day. Easy Eddie had a son. He loved his son and gave him all the best things while he was growing up: clothes, cars, and a good education. And because he loved his son he tried to teach him right from wrong. But one thing he couldn't give his son was a good name, and a good example. Easy Eddie decided that this was much more important than all the riches he had given him. So, he went to the authorities in order to rectify the wrong he had done. In order to tell the truth, it meant he must testify against Al Capone, and he knew that Al Capone would do his best to have him killed. But he wanted most of all to try to be an example and to do the best he could to give back to his son, a good name. So he testified. Within the year, he was shot and killed on a lonely street in Chicago. This sounds like two unrelated stories. But Butch O'Hare was Easy Eddie's son.  Do you think Easy Eddie was able to pass the value of integrity on to his son? Origins:  Some parts of this glurge about Edgar Joseph "Easy Eddie" O'Hare (also known as EJ) and his son, Edward Henry "Butch" O'Hare, are true, if exaggerated in the presentation above. The senior O'Hare provided legal services to Al Capone and later helped the government bring that notorious gangster to justice on tax fraud charges in 1931, then was murdered on 8 November 1939.  (Exactly who killed Eddie O'Hare has always been a subject for debate, but the preponderance of the evidence indicates that he was killed on orders from Capone for having given information to the government that led to Capone's imprisonment.)  Eddie's son Butch was a pilot who died in the Pacific during World War II when he failed to return to his carrier after a night mission on 26 November 1943, and Chicago's O'Hare airport was indeed named in his honor. (Dispute remains over exactly what happened to Butch, a Medal of Honor winner, but the preponderance of the evidence indicates his plane was downed by friendly fire rather than Japanese Zeroes.)   This glurge completely  jumps the tracks, however, in trying to turn the story of Eddie and Butch O'Hare into a tale of redemption, a little morality play to demonstrates the importance of recognizing the errors of one's ways, of atoning for one's misdeeds, of trying to do right and prevent one's sins from being visited on future generations.  Those are all valuable lessons, but they have precious little to do with this story. Eddie O'Hare was not just a gangster's lawyer, he was also a partner in some of Al Capone's illegal activities. Despite having entered a profession in which he was expected, of all things, to uphold the law, the senior O'Hare broke the law to enrich himself through unethical and illegal schemes in partnership with the most notorious gangster in American history.  What's more, he served Capone as an attorney and business manager, aiding the mobster in setting up illegal enterprises and helping to keep Capone and his cronies out of prison. When "Easy Eddie" did eventually provide information that aided federal authorities in sending Capone to prison for income tax evasion, it was far less likely that he did it because he had an attack of conscience, wanted to right the wrongs he'd done, or sought to teach his son the value of integrity.  More probably he turned state's evidence because he could see the handwriting on the wall: Capone was going to be nailed with or without his assistance, but by doing the government a favor Eddie could keep himself out of prison.  (Some sources even suggest the connections Eddie made by turning government informant were what got his son Butch a berth at the U.S. Naval Academy in Annapolis.) Perhaps Eddie O'Hare believed or knew he would be killed for what he had done; perhaps not.  Either way, it was his son Butch who redeemed the family name through his wartime bravery and heroism, and the price he paid for that redemption was his life.  None of that redemption was achieved through the actions of Easy Eddie. Was the elder O'Hare "able to pass the value of integrity on to his son"?  If his actions illustrated anything, it was just the opposite of integrity: if you're clever enough and sufficiently lacking in moral values you can live a life of wealth and privilege by victimizing others, and if  your gravy train should ever derail you can adopt an "every man for himself" attitude and save your own skin by ratting on your associates. Butch O'Hare was suitably honored when the Chicago airport known as Orchard Depot was renamed O'Hare International in 1949.  It's unfortunate that he and the airport have to share the O'Hare name with his unscrupulous father. Additional information:     Capone and the O'Hares  (Combined Counties Police Association)  Last updated:  1 February 2005    Sources:    Ewing, Steve and John B. Lundstrom.  Fateful Rendezvous: The Life of Butch O'Hare.   Annapolis: Naval Institute Press, 1997.  ISBN 1-55750-247-1. Fateful Rendezvous: The Life of Butch O'Hare If the nation hits the debt ceiling later this month without it being raised by Congress, economists predict a wide spread of economic harm: higher interest rates, lower economic growth and plunging consumer confidence in the United States and overseas. One particularly high-profile sign of economic distress would be a plummeting Dow Jones Industrial Average. During anappearanceon ABCsThis Week With George Stephanopoulos, Sen. Charles Schumer, D-N.Y., cited that scenario as one of the reasons why Congress should take action soon. Stephanopoulos asked Schumer whether both sides were posturing and playing with fire on the debt ceiling, which is the legal limit to how much debt the government can shoulder. Schumer said, You don't negotiate over something like the debt ceiling because -- at which point Stephanopoulos interjected, Other presidents have done it. Schumer responded, No. The one time that it was really done in this kind of way, (when it wasnt just) a deadline and you had to decide (on) abortion or something else, was in 2011. We went right up to the deadline. The stock market lost 2,000 points, $18 billion was lost by the American people. We wondered whether Schumer was right about the stock market losing 2,000 points. So we looked at historical data for the Dow Jones Industrial Average, the most popular measure of the stock market. On July 21, 2011, the Dowreached12,724 -- its high point in the months immediately preceding the debt ceiling fight. For the next 10 days, Congress squabbled over raising the debt ceiling. Then, between July 31 and Aug. 2, the White House and congressional leaders reached and implemented a deal that became known as the Budget Control Act of 2011. By Aug. 2, when the crisis was effectively over, the Dow stood at 11,866, a drop of 858 points. Thats less than the 2,000 points Schumer cited. However, the Dow continued to tumble for another two months, due in large part to repercussions of the debt ceiling debate, particularly the downgrading of the United States credit rating byStandard & Poorson Aug. 5. By Oct. 3, the Dow had bottomed out at 10,655 -- a decline of 2,069 points from its pre-debt ceiling peak, and its lowest level in about a year. So if you include the aftershocks of the debt ceiling fight, Schumer is correct that the Dow fell by 2,000 points. (You can see the decline as a line charthere.) That said, its also worth noting that the recovery was almost as quick as the decline. It took only until Jan. 25, 2012 -- about three and a half months after the low point -- for all of the pre-debt ceiling losses to be recouped. By Jan. 25, the Dow hit 12,758. And as Schumer was speaking onThis Week, the most recent Dow close was 15,072 -- an 18 percent increase over the pre-debt ceiling high, which had been about two years and three months earlier. Matt House, a spokesman for Schumer, said the Dows subsequent recovery is irrelevant. Of course (the Dow) came back, but that is of little comfort to anyone who was at or nearing retirement during those several months, he said. With 10,000 baby boomers retiring a day, that drop is incredibly important, and not to be trivialized. .... And this is all from a default that didnt happen. Still, we think its important to note that the 2,000 points the Dow lost didnt stay off for years, or even permanently, as some viewers might assume. Our rating Schumer said that because of the 2011 debt ceiling fight, the stock market lost 2,000 points. If you count the aftermath of the deal that avoided a debt ceiling breach, which included a historic downgrade of the United States creditworthiness rating, then Schumer is right that the Dow fell by 2,000 points. Still, Schumer makes it sound as if the drop happened right away. Actually, it dropped at the time of fight and continued to drop for another two months after the United States' credit rating was downgraded. We rate Schumers claim Mostly True.