Stand up for the facts!

Our only agenda is to publish the truth so you can be an informed participant in democracy.
We need your help.

More Info

I would like to contribute

By Clay Wirestone February 5, 2016

Sanders points to Goldman Sachs CEO as evidence of Wall Street power over Washington

In front of a cheering audience in Keene, N.H., on Tuesday, Vermont Sen. Bernie Sanders sounded some familiar themes: reducing income inequality and increasing access to health care and education.

During his speech at the Colonial Theatre in the college town, Sanders also focused on Wall Street banks, which he blamed for harming the economy. He highlighted the leadership of one firm in particular.

"Two years ago, the CEO of Goldman Sachs, who himself is a billionaire, came to Washington and said, ‘You know what, you in Congress are going to have to cut Social Security, Medicare and Medicaid and give huge tax breaks to the wealthy and the large corporations,’" Sanders said.

In the context of the candidate’s stump speech, he was trying to point out how financiers were out to undercut everyday Americans. (At the Jan. 17 debate, Sanders made a different, shorter version of the statement, which was dinged by Politifact Texas.) But was his statement in Keene true? Did the leader of Goldman Sachs actually make a statement to that effect?

We decided to check it out.

When asked for supporting documentation, the Sanders campaign passed along a number of articles about Goldman CEO Lloyd Blankfein’s efforts in 2012 to push the U.S. Congress and President Obama toward a deal averting the so-called fiscal cliff.

In case you’ve forgotten, the fiscal cliff was the combination of automatic tax increases -- some $500 billion -- and spending cuts scheduled to take effect on Jan. 1, 2013. Most economists agreed that the cliff would cause a brief recession, which business leaders were keen to avoid.

What was Blankfein’s role in this? According to the Washington Post, he and other executives who were part of a group called Fix the Debt held private meetings with legislators and the president on Nov. 28, 2012.

"The group’s chief executives include such corporate leaders as Lloyd Blankfein of Goldman Sachs and Mark Bertolini of Aetna," the Post wrote.

So Sanders’s timing is off.  Blankfein wasn’t in Washington doing such lobbying two years ago; he was actually there more than three years ago. But what about the senator’s claim that the executive warned of the need for entitlement program cuts and tax breaks for the wealthy?

FIx the Debt’s aims in 2012 were, broadly speaking, to encourage lawmakers to both restrain grown in entitlement spending and change the tax code to bring in more revenue. According to the Post, some members of the group also advocated for cutting corporate taxes and taxes on overseas profits for businesses.

But Sanders didn’t talk about Fix the Debt, or about the other members of the group. He mentioned Blankfein specifically. So what was the CEO thinking in late 2012? There are no transcripts of what was said during the private meetings, but Sanders’s campaign sent along an excerpt from a Blankfein appearance on the CBS Evening News from Nov. 19, 2012.

Featured Fact-check

And during an interview with anchor Scott Pelley, the financier made it clear that his position was nuanced.

Overall, he said, entitlement programs including Social Security, Medicare and Medicaid would need to be altered. "The retirement age has to be changed, maybe some of the benefits have to be affected, maybe some of the inflation adjustments have to be revised," he said. "But in general, entitlements have to be slowed down and contained."

Blankfein wasn’t calling for outright cuts to these programs. He was asking that their growth be slowed, something that other politicians have proposed. Even President Obama at one point offered a proposal slowing the growth of Social Security payments.

That said, reasonable people can -- and do -- disagree about whether slowing the growth of a government program amounts to a cut.

Meanwhile, the CEO also called for the wealthy to pay more in taxes -- a concept Sanders agrees with.

BLANKFEIN: In the long run, there has to be more revenue. And, of course, the burden of that revenue will be disproportionately taken up by wealthier people. That's just logical.

PELLEY: So higher taxes on wealthier people?

BLANKFEIN: More taxes on wealthier people, to the extent that we need to raise more revenue, and we do need to raise some more revenue.

Blankfein didn’t address corporate taxes in the interview. But in an op-ed published in the Wall Street Journal on Nov. 13, 2012, he called for businesses to work with government to lower those tax rates, noting that President Obama also supported the move.

Sanders’s campaign highlighted Blankfein’s membership in the Business Roundtable group, which just last year supported a number of proposals to lower and reform business taxes.

Our ruling

Democratic presidential candidate Bernie Sanders told an audience in Keene that the CEO of Goldman Sachs said that Congress would "have to cut Social Security, Medicare and Medicaid and give huge tax breaks to the wealthy and the large corporations."

Goldman’s CEO, Lloyd Blankfein, did call for slowing the growth of entitlement spending, which may -- or may not -- legitimately be called a "cut." The CEO also supported lowering corporate taxes, though Sanders leaves out that he also said taxes would likely need to be raised on the wealthiest people to create more revenue.

On balance, we rate the claim Half True.


Our Sources

"With primary less than a week away, Hillary Clinton, Bernie Sanders turn attention to N.H.," Concord Monitor, Feb. 3, 2016

Bernie Sanders speech, Keene, N.H., Feb. 2, 2016

Email correspondence with the Sanders campaign, Feb. 1-2, 2016

"Ted Cruz, Hillary Clinton -- and Goldman Sachs?" Politifact Texas, Jan. 19, 2016

"Demystifying the Fiscal Impasse That Is Vexing Washington," New York Times, Nov. 15, 2012

Fix the Debt, official website, 2016

"High-powered Fix the Debt group draws attention, scrutiny in Washington," Washington Post, Nov. 28, 2012

"11/19: Israel investigating Gaza bombing; Lessons from the $5-doctor," CBS Evening News, Nov. 19, 2012

"Goldman Sachs CEO: Entitlements must be contained," CBS Evening News, June 12, 2013

"Obama drops controversial Social Security proposal," CNN Money, Feb. 22, 2014

"Sanders Proposes Tax on Billionaires to Reduce Wealth Inequality," Bernie Sanders Senate website, June 25, 2015

"Lloyd Blankfein: The Business Plan for American Revival," The Wall Street Journal, Nov. 13, 2012

"Business Roundtable’s Submission to Senate Committee on Finance Tax Reform Working Groups," Business Roundtable, April 15, 2015

Browse the Truth-O-Meter

More by Clay Wirestone

Sanders points to Goldman Sachs CEO as evidence of Wall Street power over Washington

Support independent fact-checking.
Become a member!

In a world of wild talk and fake news, help us stand up for the facts.

Sign me up