Fact Checker: Ad attacks Blum's support for GOP plans

U.S. Rep. Rod Blum talks March 22 with a constituent in his office in the Longworth House Office Building in Washington, D.C. (Stephen Mally/The Gazette)
U.S. Rep. Rod Blum talks March 22 with a constituent in his office in the Longworth House Office Building in Washington, D.C. (Stephen Mally/The Gazette)


“Huge tax break for health insurance CEOs making over $500,000.”

“Rich could get nearly $2 trillion tax cut under Trump’s tax loophole.”

“Rod Blum is getting ready to vote for Donald Trump’s tax plan.”

Source of claim

The claims are part of a TV ad targeting U.S. Rep. Rod Blum, R-Dubuque, by Not One Penny, a left-leaning coalition that includes TaxMarch, MoveOn and the Working Families Party. The 30-second spot makes three claims that meet the Fact Checker’s measurable criteria, so we’ll tackle those.

First claim

Analysis: The first claim is about health insurance chief executive officers getting tax breaks under HR 1628, an Affordable Care Act repeal passed May 4 by the House but later failing in the Senate. According to a ProPublica database, Blum was one of 217 Republicans to vote for it.

That proposal would have raised a cap on how much of their CEOs’ salaries insurance companies could deduct from their taxes, according to CNBC, the source cited in the TV ad.

The ACA caps at $500,000 the amount of an executive’s salary an insurer is allowed to deduct as a business expense. The repeal proposal would have raised that cap to $1 million, but it pertained to only salary, so additional compensation, such as performance pay, could have meant further reductions for insurers, CNBC reported.

This provision could have encouraged insurers to pay top brass more money to earn larger deductions, but it’s not a tax break for the CEOs themselves.

Conclusion: This claim is misleading and inaccurate. PolitiFact Wisconsin agreed in a March 13 check of a tweet by Democratic Sen. Tammy Baldwin. We give the “huge tax breaks for health insurance CEOs” claim a D.

Second claim

Analysis: The “Not One Penny” ad asks taxpayers to tell Blum they don’t want him giving away tax cuts to the wealthy. It’s being aired as President Donald Trump on Wednesday unveiled additional parts of a proposed tax plan that expands upon a one-page tax overhaul outline he released April 26.

The ad goes back to the April outline by claiming the “rich could get nearly $2 trillion tax cut under Trump’s tax loophole.” The loophole would have reduced the business tax rate for pass-through businesses (limited liability corporations are the most common type of pass-throughs) to 15 percent instead of the individual tax rate of their owners.

Trump’s more detailed plan Wednesday would lower the pass-through rate to 25 percent.

The Trump administration says this would help small businesses and goose the economy. While many pass-throughs are small businesses, wealthy people also own them. A New York Times opinion piece by Lily Batchelder reports Trump owns more than 500 pass-throughs himself.

The Tax Policy Center, a nonpartisan collaboration of the Urban Institute and Brookings Institution, estimated last spring lowering the rate on pass-through income to 15 percent would cost about $1.5 trillion over 10 years — with 77 percent of those savings going to the top 1 percent of income earners.

If people try to game the system by creating pass-throughs specifically for the tax savings, the Tax Policy Center and Goldman Sachs estimated the impact could be more than $2 trillion, the Times reported.

Conclusion: The ad claims the tax break to rich Americans proposed in Trump’s April 26 one-page outline could be nearly $2 trillion. Estimates by reputable agencies show that would have been possible so we give it an A, although the latest tax proposal makes that outdated.

Third claim

Analysis: The TV ad also claims “Rod Blum is getting ready to vote for Donald Trump’s tax plan.” Blum did voice support for the one-page form released in April.

“The tax plan released by President Trump this week is a strong step towards a reignited economy,” Blum said in an April 27 news release. “I look forward to working with the Administration and my colleagues in Congress to advance these ideas so we can have an American economy that creates prosperity for ALL citizens of our country.”

Given that the revised tax plan hadn’t been released when the ad started airing, it’s premature to say Blum is getting ready to vote for it. John Ferland, a Blum spokesman, said Wednesday “there is much work to be done before we have a piece of legislation” for Blum to consider.


“That being the case, there is a tremendous opportunity to increase working families take-home pay, simplify an unbelievably complicated tax system, bring businesses back to America that are now overseas, and to help make America THE best place in the world to do business,” Ferland wrote in an email.

Blum voted with Trump 95.6 percent of the time since January, according to an analysis by FiveThirtyEight.

Conclusion: Given Blum’s statements about the Trump tax plans and his alignment with the president, it seems likely he’d vote for a more detailed proposal from the White House and GOP. We give this claim a B.


The Fact Checker team checks statements made by an Iowa political candidate/office holder or a national candidate/office holder about Iowa, or in advertisements that appear in our market. Claims must be independently verifiable. We give statements grades from A to F based on accuracy and context.

If you spot a claim you think needs checking, email us at factchecker@thegazette.com.

This Fact Checker was researched and written by Erin Jordan.



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