Cruz Tells Another Lie in Presidential Announcement

The fact-checking websites have found Ted Cruz to be about as truth-impaired as Michele Bachmann, which is to say that he lies. A lot. He even told a whopper of a lie during the announcement of his run for the Republican presidential nomination, falsely claiming that small businesses are closing “in record numbers.”

“Think just how different the world would be. Imagine instead of economic stagnation, booming economic growth,” Cruz said. “Instead of small businesses going out of business in record numbers, imagine small businesses growing and prospering. Imagine young people coming out of school with four, five, six job offers.”

Let’s leave imagination land and return to the real world to evaluate whether businesses are closing their doors “in record numbers.”…

The Center for Economic Studies at the U.S. Census Bureau surveys private businesses and their administrative records to track the number of firms and establishments over time. We want to look at firms with fewer than 500 employees, not establishments, which would include every single Starbucks across America. Firms are a count of companies no matter the number of locations, which allows us to single out small businesses in the truest sense.

The number of firm “deaths” — meaning every location owned by a business was completely closed down — for businesses with fewer than 500 employees has been trending up since 1984. The peak came in 2009 during the height of the recession, when nearly 500,000 small businesses closed their doors.

However, as of 2012 (the last year available) the number of business deaths had fallen back to where they were in 2005, 1998 and 1988.

Data for the last couple years is not available, but if the trend from 2010 to 2012 holds, those numbers would likely paint an improved picture, said Zoltan Acs, on leave as director of the Center for Entrepreneurship and Public Policy at George Mason University.

“Those are all recession years and we know that we’ve been adding jobs for the last couple years so this is no longer happening,” Acs said.

The highest numbers for small business closures were in the late 70s and early 80s, which is quite predictable. We were suffering through the stagflation of the late 70s due to oil price shocks, then by the very deep recession brought on by Fed chairman Paul Volcker jacking interest rates up to wring inflation out of the economy. But it’s clear by now that Cruz doesn’t really care what is true, only what is politically useful.

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  • screechymonkey

    I guess it’s easy to be considered a great debater if you’re willing to just invent your own facts.

  • dmcclean

    Missing phrase from the politifact article and this discussion of it: “per capita”. Americans are existing in record numbers, so whatever upward trend may exist, whether or not it currently is at “record numbers” is meaningless unless you compare it to population growth.

  • dmcclean

    I take it back, they do talk about it later as a share of businesses, which is another good way to look at it.

  • Die Anyway

    If every student coming out of school had “four, five, six job offers”, can you imagine the pressure businesses would be putting on the government to open up immigration? More immigrants, I didn’t think that’s what Cruz wanted.

  • cry4turtles

    So it’s true. The way to tell when Cruz is lying is actually when his mouth is moving!!!

  • http://en.uncyclopedia.co/wiki/User:Modusoperandi Modusoperandi

    The number of firm “deaths” — meaning every location owned by a business was completely closed down — for businesses with fewer than 500 employees has been trending up since 1984.

    Thanks Obama!

  • Kevin Kehres

    Any more, I am very careful in my “conversations” with right-wingers, creationists, anti-vaxxers, and global warming denialists. Because the one common characteristic they all exhibit is an almost pathological inability to get even the slightest facts right.

    Before I engage, I double check their facts. Chances are, their base assumptions are pretty much made up on the fly. Or cribbed from someone else who is lying their ass off.

  • http://www.pandasthumb.org Area Man

    If every student coming out of school had “four, five, six job offers”, can you imagine the pressure businesses would be putting on the government to open up immigration?

    It would also mean higher wages because of a tight labor market, something that Cruz and his fellow Republicans would stop at nothing to prevent.

  • ffakr

    @Kevin.

    “Conservative Facts” are a given.

    Job one is always to look up the numbers used in this Universe.

    Just yesterday, I replied to someone claiming that Obama was just as bad as Reagan on the deficit.. Yes, he was one of the few that Reagan spent like a drunken sailor.

    With a quick search, it was easy for me to confirm that in this Universe, their records have been almost exactly the inverse of each other. Reagan’s yearly budget deficits roughly tripled compared to Carter’s last budget period. Obama’s yearly budget deficits appear to be down to about 1/3rd of the last Bush budget period.

  • http://www.pandasthumb.org Area Man

    This brings up one of my pet peeves, the obsession with the size of businesses. There is nothing magical about “small business” that makes it nobler or worthier than the much maligned “big business”. If goods and services are produced more efficiently on a large scale, then so be it. We shouldn’t romanticize doing it small-scale just for the heck of it. There was a study not long ago that found that countries with a greater proportion of small businesses tend to have the worst economies. If you want to see a land of small business nirvana, go to Greece.

    I’m pretty sure that “small business” in the minds of most Americans is proxy for “middle class”, those hard working people who run the corner grocery or family restaurant, not the rich hedge fund manager who owns an orange grove as a tax write-off. Republican policies are almost exclusively designed to enrich the latter and screw the former, so I faceplam every time someone like Ted Cruz pretends to give a shit about “small business”.

  • Numenaster

    You are probably right that Cruz doesn’t care about small business, but as members of society we have a good reason to be in favor of them. A small business is not large enough to capture the agency intended to regulate it, as we have seen fossil-fuel corporations and financial corporations do.

  • http://sidhe3141.blogspot.com jy3, Social Justice Beguiler

    screechymonkey (1):

    He is truly an intellectual of the Right (but intellectualism is bourgeois elitist, so let’s add some kind of qualifier to it). And a master of debate.

    I suppose you could even call him a pseudo-intellectual master-debater.

  • http://www.pandasthumb.org Area Man

    A small business is not large enough to capture the agency intended to regulate it…

    But a collection of them, known as your local Chamber of Commerce, Restaurant Association, etc. certainly is. And they’re extremely obnoxious when it comes to that sort of thing (think car dealerships and their successful campaigns to prevent Tesla from selling direct to the consumer).

    At any rate, if the problem is regulatory capture then we should fight against regulatory capture. That should be easier, politically speaking, than disfavoring large firms in general.

  • StevoR

    Politician less than truthful -indeed pants on fire lying – in campaign? Oh noes!! I never woulda seen that coming! (Much.)

    But, yeah, that is shit and wrong of Cruz albeit also just totally expected and predictable.

  • D. C. Sessions

    Don’t forget that the Republican defintion of “small business” is based on how it files its taxes, not on its cash flow or payroll. In the Republican Luntzicon, any pass-through corporation is a “small business.” This includes PriceWaterhouseCoopers and Bechtel, to name two.