Attack-Ad Alchemy

FactCheck.org

In the Virginia race for governor, Republican candidate Ken Cuccinelli is running a TV spot that practices the dark art of political alchemy — turning facts into falsehoods. And it does so while claiming to be telling “the truth.”

This ad started airing Aug. 25, only two days after we reported that attack ads by both sides in this race were “generally on target” and pretty much stuck to accurately stating the messy facts about each candidate. Now it seems we spoke too soon.

The ad’s on-screen graphics are accurate enough. But the narrator’s commentary distorts them to the point of being deceitful.

McAuliffe Not Under Investigation

“The truth?” the narrator asks. “There’s only one candidate under investigation, Terry McAuliffe. Potential fraud … ” But that’s not true.

As the ad’s graphics state correctly, it’s the company Democrat McAuliffe helped set up, GreenTech Automotive, that has had its records subpoenaed by the Securities and Exchange Commission. The SEC is investigating what promises GreenTech made to potential foreign investors, saying that fraud is “possible but not fully verified,” according to internal documents cited by the Associated Press.

But there’s no indication or evidence that McAuliffe himself is being investigated personally. He owns 25 percent of the company but stepped down as chairman of the board in December. He says he learned of the SEC’s subpoenas from reading news accounts, and that he wasn’t responsible for preparing the investor material that the SEC is questioning.

Hiring, Not Firing

The narrator also says the possible fraud “killed jobs,” but that’s another claim without a factual foundation. GreenTech is gaining jobs, not the other way around.

The company says it now employs more than 80 persons in Mississippi and about 10 at its headquarters in Virginia. The company currently lists a dozen job openings, mostly in sales and engineering. And it says it plans to move production from its current temporary factory in Horn Lake, Miss., to a new and larger plant in nearby Tunica sometime next year.

To be sure, U.S. hiring so far has fallen far short of the “thousands” of new jobs that McAuliffe once promised. And we find no fault when other attack ads accurately point out this embarrassing failure. It’s also a fact that GreenTech proposed to build a plant in China that would be 10 times larger than the one it is building in Mississippi, leaving McAuliffe open to the same accusation of creating jobs in China at the expense of U.S. workers that he and other Democrats are fond of making against Republicans.

But as we reported, work on the China plant was halted indefinitely when Chinese government funds dried up, and GreenTech says it employs only a skeleton staff of five persons there, awaiting a possible restart of the project. Furthermore, that plant would have been assembling cars using a number of components manufactured in the U.S., according to GreenTech.

Based on the evidence, McAuliffe’s claims of being a big job creator can fairly be criticized as mostly hot air. But accusing him of “killing” jobs bends reality 180 degrees.

‘Threatened National Security?’

The narrator also says the alleged “potential fraud” not only “killed jobs” but “threatened national security.” That’s another claim that goes way too far. There has been no official finding to date — or even a credible allegation — that anything McAuliffe or GreenTech did “threatened national security.”

The ad’s graphics correctly quote a now-familiar snippet from an email sent to colleagues by a Virginia business-development official, Liz Povar, dated Nov. 17, 2009. In it, she expressed objections to giving state approval to GreenTech’s proposal to raise money from foreign investors who would get U.S. worker visas under the federal EB-5 immigrant investor program, which grants the visas to foreigners who invest at least $1 million (or in some cases $500,000) in businesses that create U.S. jobs. “[I] still can’t get my head around this being anything other than a visa-for-sale scheme with potential national security implications that we have no way to confirm or discount,” she wrote.

But Povar’s worry that the EB-5 arrangement had “potential national security implications” is a far cry from any allegation that it actually “threatened national security,” as the ad’s narrator claims. Povar didn’t specify what sort of “implications” she had in mind. And when her email was released to reporters under the Freedom of Information Act, her agency departed from its usual “no comment” rule to play down the notion of a “visa for sale” concern.

‘Fleeting Moment of Inappropriate Speculation’

Povar’s current boss, Martin Briley, president and CEO of the Virginia Economic Development Partnership, said (in other internal emails) that he told the Washington Post that Povar’s “visa for sale” comment was “likely a fleeting moment of inappropriate speculation but certainly not representative of VEDP’s position on the EB5 program then or now.” He said his agency “does not have the expertise” to draw such a conclusion about a federal program. (The Post did not use this quote, and so far as we can tell it is reported here for the first time in any news account.)

Martin_Briley_4-10-2013

So far as we know, nobody has yet come close to documenting even a credible allegation that GreenTech’s potential investors posed any national security threat, though Republican Sen. Charles Grassley of Iowa has been grilling FBI and Homeland Security officials on this score. Grassley has drawn a connection between GreenTech and one executive of a Chinese telecom company that the House intelligence committee has concluded cannot be trusted to provide telecom equipment or services in the U.S. But such equipment and services aren’t at issue with GreenTech.

Grassley on July 24 released a series of internal emails among federal immigration officials (as an attachment to a letter to four other members of Congress) stating that one of GreenTech’s potential investors was Zhenjun (Richard) Zhang, identified as a vice president for sales of Huawei Technologies Ltd. And that China-based telecommunications giant was accused by the House intelligence committee in a report released Oct. 8, 2012, of being a threat to U.S. national security.

But the House intelligence committee didn’t say that granting visas to Huawei employees would endanger national security. Instead, it urged that the government and U.S. businesses avoid buying communications equipment or services from the company, and that Washington should block any mergers, acquisitions or takeovers by Huawei involving U.S. companies.

So far we’ve not seen any explanation of how an investment by a wealthy Chinese individual in a company that makes battery-powered, two-passenger cars that go 35 mph would threaten national security, even if one of those investors was employed by a telecom company accused of spying.

Cuccinelli’s ad would be accurate to say that his opponent’s company is under investigation for possibly defrauding foreign investors, that it has failed to produce the “thousands” of jobs McAuliffe promised, and that a Virginia official worried privately about unspecified national security “implications” of its proposed funding. But his campaign chose instead to embellish.

– Brooks Jackson

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