Rogue Fact: Palin offers inaccurate warnings about Democratic proposals' effects on small businesses

In her memoir, Sarah Palin offers numerous falsehoods in writing that she warned her daughter Bristol not to open her own small business because the “Democrat-led Congress” would purportedly dictate “how you should invest your money, the color of your roof, your source of energy generation, and what kind of health insurance you must offer, and even the kind of cars you can have in your company fleet.” Palin's warnings inaccurately characterize the effects of provisions of Democratic stimulus, health care, and clean energy legislation.

Palin: Don't open a business while the “Democrat-led Congress” is dictating to you

From Palin's Going Rogue: An American Life:

The more I heard about the new Democrat administration's economic philosophies, the more I feared for the future of free enterprise. Now, I put a finer point on my advice to Bristol on opening a business: “In fact, don't do this until this administration understands government's role in private business. Or wait until they're out of office.”

I told Bristol she had a lot to consider in creating her business plan. Can you imagine setting up a business while the Democrat-led Congress is dictating how you should invest your money, the color of your roof, your source of energy generation, and what kind of health insurance you must offer, and even the kind of cars you can have in your company fleet? [Going Rogue, Page 358]

Energy bill doesn't require roofs be painted white, it offers incentives to do so

Congress not considering any law “dictating ... the color of your roof.” With regard to Palin's claim that the “Democrat-led Congress is dictating ... the color of your roof,” at a climate change symposium in May, Energy Secretary Steven Chu noted that painting roofs white would have the effect of increasing their albedo and cutting greenhouse gas emissions. However, the relevant legislation to pass the House, the American Clean Energy and Security Act of 2009, does not require roofs be retrofitted in this manner, it simply provides financial incentives to do so.

Section 202 of the bill requires:

that building retrofits conducted pursuant to a [Retrofit for Energy and Environmental Performance] REEP program utilize, especially in all air-conditioned buildings, roofing materials with high solar energy reflectance, unless inappropriate due to green roof management, solar energy production, or for other reasons identified by the Administrator, in order to reduce energy consumption within the building, increase the albedo of the building's roof, and decrease the heat island effect in the area of the building, without reduction of otherwise applicable ceiling insulation standards [emphasis added].

As explained by the National Association of Realtors to Factcheck.org, the provision encourages states and qualifying local governments that receive stimulus funds to provide incentives to property owners to retrofit their roofs, but does not require buildings be retrofitted in that manner:

No, section 202 does not require that buildings be retrofitted. Rather, it provides federal funding for states to offer financial incentives, such as loans or grants, for property owners to voluntarily decide to improve energy efficiency. In order to receive the funding, there are conditions on how states can spend the money, such as verification of energy improvements performed by private contractors, but that is only to ensure that taxpayer dollars are actually spent on the purpose for which it is intended (building efficiency improvements) [emphasis added].

Health care reform bills protect small businesses from requirement to provide health insurance to employees

Under the bills currently before Congress, small businesses are protected from the requirement to provide insurance coverage to employees. Contrary to Palin's claim that “the Democrat-led Congress is dictating ... what kind of health insurance you must offer,” the bills passed by the House and by the Senate's Finance and Health, Education, Labor, and Pensions (HELP) committees include exemptions protecting small businesses from requirements that employers provide health insurance to their employees or pay a fine. In fact, under all three bills, eligible small business would receive tax credits for choosing to provide health insurance coverage to their employees.

  • According to the House bill's summary, “Small businesses with annual payrolls below $500,000 are exempt from requirements to offer or contribute to coverage, including the 8 percent payroll contribution for failure to provide health benefits to their workers.” Additionally, "[t]here is also a tax credit program to help low-wage small businesses offer coverage to their employees."
  • According to the Senate HELP Committee bill's summary, penalties for employers who “do not offer qualifying coverage” to their employees do not apply to employers with 25 or fewer employees. Additionally, “employers with 50 or fewer full-time workers who pay 60 percent or more of their employees' health insurance premiums will be permitted to receive tax credits for subsidizing coverage.”
  • Under the Senate Finance Committee bill, businesses with fewer than 50 employees are exempt from the bill's excise tax for employers that do not offer insurance to their employees. Further, small businesses with no more than 25 full-time employees with an average salary of $40,000 are eligible to receive a tax credit for offering health insurance to their employees.

Stimulus, regulations do not dictate the kind of cars businesses have in their fleet

The “Democrat-controlled Congress” has not considered laws dictating "the kind of cars you can have in your company fleet." Neither the American Recovery and Reinvestment Act nor the energy bill “dictat[es]” the “kind of cars you can have in your company fleet.” The recovery act provides $300,000,000 for the federal government to make “capital expenditures and necessary expenses of acquiring motor vehicles with higher fuel economy, including: hybrid vehicles; neighborhood electric vehicles; electric vehicles; and commercially-available, plug-in hybrid vehicles,” and tax credits for “new qualified plug-in electric drive motor vehicles.” Likewise, the House energy bill provides “credits to fleets that repower or convert an existing vehicle so that it is capable of operating on an alternative fuel,” but does not require such conversion. Additionally, President Obama has implemented new mileage and emissions regulations that will require cars to increase fuel efficiency.

From the May 20 edition of The Wall Street Journal:

The rules would require new passenger cars sold in the U.S. to meet an average mileage requirement of 39 miles per gallon by 2016. Light trucks would have to deliver an average of 30 mpg. That's a dramatic rise from current averages -- 27.5 mpg for cars, 23 mpg for trucks -- and would bring the overall average of cars and light trucks to 35.5 mpg by 2016, four years earlier than current federal law requires.