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Reality Check: Feingold, Johnson Ads Spar Over Gov. Bond

Published On: Sep 21 2010 05:18:46 AM CDT
Updated On: Sep 21 2010 06:16:11 AM CDT

WISC-TV's We the People Wisconsin Fact Finder reports continue with a look at a battle over TV news coverage.

There are two central questions to the battle of the words between U.S. Sen. Russ Feingold and Republican challenger Ron Johnson.

First, does the bond that Johnson's company received constitute a government payment? Second, is Feingold's characterization of the issue in a 30-second TV ad misleading?

"I have never lobbied for some special treatment or for a government payment," said Johnson in television coverage by a Madison TV station. The clip was used by Feingold in an ad that strings together clips from the station's coverage, asserting Johnson got "government aid," or a "government payment."

A WISC-TV analysis found this needs clarification.

News coverage in the ad shows Johnson's company Pacur got $4 million in "government loans" in the 1980s.

WISC-TV's partners at Wisconsin Public Television found that these industrial development bonds are issued by local governments then sold to a private bank. It's essentially a special low-interest loan, paid back by the business, where rates can beat a loan the same business might get just going through a bank.

In this case, a Fact Finder analysis shows Johnson saved more than $350,000 over the life of the loan by doing it this way. Is that a government payment?

"They're not a direct payment like sending a check to a business or a farmer," said Gary Green, a University of Wisconsin Extension economic development specialist. "They're an indirect subsidy in that they're a loss of revenue to the federal government and in some cases, state government, and that transfer of resources is considered in all cases, a subsidy."

Then there's Johnson's response ad.

"This newscaster's station says Feingold took their report out of context and that its just plain wrong," says the announcer in Johnson's ad. "The Associated Press says Feingold's ad is misleading and Ron Johnson's loans came from private investors."

WISC-TV also found this claim misleading.

The TV station did say Feingold took the report out of context, but instead said Feingold using the footage without permission was "just plain wrong."

Then the ad uses two separate Associated Press stories, making them seem like one. The one in the back that's being crossed out in the ad was once again news coverage reporting on Johnson's loans. The pulled quote in front is from a recent analysis of Feingold's ad, which said the references to government aid were misleading.

As mentioned in Feingold's ad, Johnson's company also got $75,000 to help build a rail spur, and that was a federal grant. But Johnson said that happened before he joined the company.

If you have a question or claim for Fact Finder to check out, send it to, and check out all our recent reports at

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