Monday, April 18, 2011

POLITICS - The Tax and Income Issues

"Shields, Brooks on 'Flexible' U.S. Policy in Middle East, Deficit Plans" PBS Newshour Transcript 4/15/2011

Excerpt on tax issue

JIM LEHRER (Editor, Newshour): But the President and Secretary Geithner on this program that same night said, look, if there is going to be deficit reduction, you're not going to do it without raising taxes.

DAVID BROOKS, New York Times columnist: Yes. That, I absolutely...

JIM LEHRER: And then he drew a line.

DAVID BROOKS: Right. And he's absolutely right about that.

JIM LEHRER: He is right, you think?

DAVID BROOKS: Right. So, but -- he is absolutely right. But there are simply not -- even if you did it by raising taxes -- and this is a very tax-heavy plan -- there are simply not enough rich people to pay for the tens of trillions of dollars in unfunded deficits these programs are racking up.

And so I think you have to talk about the middle class. You have to talk about seniors. And his program is very careful to not touch those third rails.

MARK SHIELDS, syndicated columnist: It's not a tax-heavy plan. If you want to talk about a tax-heavy plan, come up with the plan that was authored, written by Alice Rivlin, a Democrat, and Pete Domenici, a longtime Republican senator. Theirs was $2 of cuts, $2 of revenue.

Obama's is like the Simpson-Bowles. It's $2 of cuts -- I agree with you, the lacks of specific -- only $1 of tax increase. And so, I think that the case he has to make is: I believe in these programs. The program is in trouble. And if you want it saved, I am the guy that's going to save it. I believe in it.

And I agree with David that the sacrifice is going to have to be universal. It cannot be simply -- it can't be done by the wealthy. But I would point out that the wealthy, as the president pointed out very well in the speech, the top 1 percent have seen, on the average, their income go up $250 million in this past decade, while 90 percent of lower earners, 90 percent, have seen their average income go down.

And that's where the Republicans just don't get it, in my judgment. They say fairness doesn't really come into it. You have got to believe in the market.

JIM LEHRER: And, David, the Republicans said in response to what Mark just repeated that the president said, that's class warfare. That's unfair.

DAVID BROOKS: Yes. And, here, I think they're wrong. I do think we have to raise taxes on the top 1 percent. I think we have to have a big tax reform that raises revenue. And here...

JIM LEHRER: But that's raising taxes, too.

DAVID BROOKS: Right. Exactly. But you have got to raise revenue across more than just the rich. We have got to raise it on the rich to some degree, but you have got -- there's just -- as I said, there's just not enough.

And so you're going to have -- what you have to do is do what Bowles-Simpson suggested, which is lower the rates and broaden the base and close those loopholes. I think the Bowles-Simpson plan on tax reform had the right plan.

Now, the president sort of said, he suggested maybe he was a little for Bowles-Simpson. But he also says, oh, we have got to raise the rates. So he went against Bowles-Simpson. And so he is sort of two minds about that. So, you know -- go ahead.

Again, I agree, you CANNOT balance the budget without tax increases.

If, we "the people" want programs like Medicare, Social Security, and others, we have to pay for them especially if any cuts would make the program ineffective or useless. There IS no "free lunch."

Comment for Republicans; call it "class warfare" if you want, but it is still unfair. Further, I consider it un-American to have such a big imbalance.

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