Monday, December 20, 2010

POLITICS - Tax-Cut Compromise & Earmarks

"Shields, Brooks on Tax-Cut Compromise, Holbrooke, Earmark Wrangling" PBS Newshour Transcript 12/17/2010 (includes video)


JIM LEHRER (Editor, Newshour): The tax cut law -- or the tax cut deal is now the law of the land. And is all well in America as a result?

MARK SHIELDS (syndicated columnist): Jim, I think you can already feel harmony and tranquility is griping the continent.


MARK SHIELDS: A couple of things.

I mean, victory legislatively and all that -- not the toughest vote in the world, Jim to stand up and say, I'm going to ask you one thing, Jim Lehrer. Could you cast a vote to cut everybody's taxes?

Mr. President, only because it's in the good interest of the country will I do it. I know it's my patriotic duty.

I mean, we haven't reached the point where a president has asked us to cut anybody's spending or to raise anybody's taxes. But, that said, I thought that the best analysis was made by Peter Welch, the Democratic congressman from Vermont, who said, too much debt, too few jobs.

And I think we all hope that it is going to generate economic activity. But I think there is an overlay of skepticism among many Democrats.

JIM LEHRER: David, President Obama, speaking of Democrats, is getting most of the credit for this having been passed. Does he deserve it?

DAVID BROOKS (New York Times columnist): He deserves some. I mean, it is an easy thing to spend, tax cuts. But you have got to crawl before you can walk. I mean, we haven't seen a lot of signing ceremonies with Mitch McConnell standing there with President Obama. So...

JIM LEHRER: This, in fact, may be the first.

DAVID BROOKS: That is a good point. I hadn't thought of it. Yes, it could be.

JIM LEHRER: Yes, yes, yes, in the two years of the Obama administration.

MARK SHIELDS: Kentucky Derby week, I think.

DAVID BROOKS: Kentucky Derby week, yes, yes.


DAVID BROOKS: Yes. So, no, I think, you know, think about what the tone would be like if this hadn't -- if they hadn't been able to reach this deal, if we have a Republican Congress, very aggressive, very confrontational coming in.

I think this has changed the tone a little. I think it has at least opened the crack for future compromise. As to the substance, I don't think it's going to be a big stimulus. But I think, if we had raised taxes -- it might have averted something.

Now, frankly, I'm -- I think is a good deal. It is probably good for the economy. It will probably create a little boost. I have spent a lot of the week in New York with business and financial people. And maybe they are living in a bubble, but the mood there is way more confident about the economy -- or optimistic -- than the mood here.

JIM LEHRER: What do they say?

DAVID BROOKS: That things are opening up, that the Christmas season has started out pretty well. They are suddenly saying, we have had this period of contraction. Everything is tamped down. But now they have a feeling of release.

And, if that's true -- I hope it's true -- then this will look like a mistimed stimulus. But we can't be confident of that. I think the projections are still slow growth. But maybe they are right. But I was really struck by the complete difference in tone between Washington conventional wisdom about the economy and New York conventional wisdom.

MARK SHIELDS: Could I just make one dampener on that?

JIM LEHRER: You may.

MARK SHIELDS: And that is that, Jim, the law, if it was allowed to go forward, would have resulted in taxes being raised, especially on the wealthiest. There was no way that taxes were going to be raised on middle-income people.

And, if two years away from an election, there wasn't the will or the backbone to do that, can you imagine seriously, on election year 2012, when this expires, that, when the Republicans are in control of the House, that you are going to stand up and say, now's the time to increase taxes?

I mean, that's the fear, that these tax cuts have been made permanent.


MARK SHIELDS: And what we're talking about is, in the short space of five years, that the interest on the national debt will be -- the interest will be larger than the defense budget is today. I mean, that is a -- that is such a sobering and really scary prospect. And I think that's part of the...

DAVID BROOKS: That's why -- I mean, my hope is that it will all be subsumed in a larger, a much larger, debate, a big tax reform debate, a big spending debate.

And to have that debate, you have to build up some areas of trust. And I think, as the administration is looking forward, especially to the State of the Union, they are thinking, we are going to have fights about repeal of health care, but how can we build a fence? How can we build a fence against some issues where we think we can do -- and I think the administration is pretty far advanced.

I'm thinking about corporate rate reform, maybe some individual. I think the president would like to do some Social Security reform. So, they are trying to think of areas where they can work together and sort of build on at least the spirit of what has been done here.

JIM LEHRER: And then fight about everything else.

DAVID BROOKS: Of course, but that is politics. That's normal.

JIM LEHRER: Sure. Sure. Sure.

Speaking of fighting, the earmarks problem -- of course, it's in this new spending bill, and people were saying it was $8 billion out of a -- what, is it a $1.2 trillion spending bill.


JIM LEHRER: Is this something to get worried about?

DAVID BROOKS: No, not particularly.

Earmarks have become the symbol of Washington insider dealing and corruption. And I understand why that is. I think, if you started when the Republicans took the majority, there were like 2,000 earmarks a year in the big budgets. And then that ramped up in those years to 14,000. And that was probably a problem.

But a lot of that is just the grease you need to get things done. And a lot of very good programs are funded by earmarks. And if you are looking at the total budget situation, it's trivial. What matters is Medicare. Nobody wants to talk about Medicare, so they get tough on earmarks.

And so what's happened is a complete change in standards. What was acceptable three years ago when it comes to earmarks is now completely unacceptable. But we should remember it's symbolic. If you want to be serious about deficits, you have got to be serious about entitlements and taxes, the big things.

MARK SHIELDS: Part of it is the most rank of all political character defects. That is hypocrisy. It is a little bit like the chairman of the Citizens for Decent Literature just getting caught coming out of a pornographic movie theater.

You had, in rather a magic moment in the Senate press gallery, Senator John Thune of South Dakota, a potential presidential candidate, Senator John Cornyn of Texas, also mentioned as a presidential candidate, standing up there, talking about this terrible bill, this omnibus bill that the Democrats have came up with, $1.2 trillion, to fund the government, and being asked about the earmarks they have put in it, 25 in Thune's case, 46 in Cornyn's case, specific earmarks.

And they -- Thune -- Senator Thune said, he was for projects, but he was against the bill. So, the Republicans have made earmarks a big issue. I happen to come down on the side of Bob Bennett, the retiring senator from Utah, who pointed out, look, if you give up all earmarks, the Congress does, you're transferring enormous power to any president, the administration.

They're going to make all the spending decisions. And, yes, so, Congress -- I mean, people talk about constitutional powers and checks and balances. They are just giving enormous -- I mean, the idea of making them transparent and accountable and not for profit, I think, is legitimate, that people have to stand up and say, yes, I put that in there, and this why I did it.

But I think it really is in excess.

Bold-blue emphasis mine

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