There’s no talking to the Republicans literally because they will storm out of the room like little kids: “I’m taking my budget and going home.” Today a major breakdown budget negotiations as House Majority Leader Eric Cantor flat out bailed on the talks. He said he cannot deal with any more talk about raising taxes on billionaires. Poor Cantor.
Moments ago Nancy Pelosi responded to Cantor’s move in an exclusive interview with our own Lawrence O’Donnell: “It’s an interesting tactic. It doesn’t happen to be valid because the point is that we are willing to have a balanced package. They are not. They are not. They do not want to talk about taxes, Eric Cantor. But it is interesting that they—and I knew, and we all said what they are going to do is say, even though we can agree on certain cuts, you won’t go for them unless we raise taxes to the American people. No we are not. We are just saying to make our tax system fair so that everyone pays their fair share.”
Now hours after Eric Cantor pulled that, Republican Senator John Kyle did the same: “Apparently they got budget interruptus.” Until finally planned talks led by Vice President Biden were simply cancelled for the day. John Boehner says he understands Cantor’s hissy fit: “I know the frustation that he feels when Democrat members continue to want to bring tax hikes into this conversation….And I think Mr. Cantor has made it clear that these conversations could continue if they take the tax hikes out of the conversation.”
Well the obvious reality is that the GOP thinks that they can push the Democrats around, so they are drawing another line in the sand on taxes. And honestly, who can blame them? The White House as usual had an inexplicably horrible strategy in these so-called negotiations. They agreed to at least $2 trillion in spending cuts before they even started talking about taxes. And now they are expecting Republicans to discuss taxes after they already gave them the spending cuts? Why would they do that? Can anyone be really this bad at negotiation?
And by the way, if that negotiation strategy sounds familiar, it’s because it is. Obama gave Republicans more than they originally asked for when he agreed to roughly $38 billion in budget cuts to avoid a government shut down. Now who gives their opponents more than they ask for? Months before that, the President agreed to extend the Bush tax cuts for the rich.
These guys are like a reverse price line. They go in and make the highest bid against themselves and then wonder why they didn’t get a good deal. And that’s exactly why Republicans now believe that the White House will roll over every single time. But don’t take my word for it; take Mitch McConnell’s: “They could not get a tax increase on people making a million dollars and up through a Congress that they had overwhelming control of….Taxes aren’t going to be raised. If they couldn’t raise taxes when they owned the government in the last Congress, you know that they cannot do it now.”
Ah, he’s rubbing their faces in it. But the really scary thing, Democrats are signaling that they may not only back away from raising taxes on the rich—are you ready for this—they might also be willing to lower taxes on corporations; [Virginia Senator Mark Warner, a member of the Deficit Commission said], “The way we’re dealing with revenues is not raising taxes, we are actually going back to the Reagan approach, which is lowering tax rates, getting rid of a lot the tax exemptions….”
We are going to sum it up. They are going to slash programs that help the middle and low income families while lowering corporate taxes. So you tell me, are Democrats the worse negotiators in human history? Or is everyone in D.C. playing a game on us, where they know what the outcome is, where we are going to take the hit again and the rich and the powerful are going to slide again.
Alright, well let me pose that question to a man who does not play those games, Independent Senator from Vermont, Bernie Sanders. Senator, great to have you here. As I look at this, I think, wasn’t this the most obvious to be expected move of all time when you first give away the spending cuts and then, gee, why, I wonder why the Republicans didn’t go along with the tax cuts?
Senator Bernie Sanders: Cenk, I think you hit the nail right on the head. And here’s the pity of it all. By overwhelming numbers of every single poll that I have seen, that deficit reduction must be accomplished through shared sacrifice. That the wealthiest people in this country can no longer enjoy huge tax breaks. That corporations making billions of dollars in profits are not paying a nickel in taxes. Have got to have those loopholes addressed. That’s what the American people believe in overwhelming numbers.
My view is that the President has got to use this Republican walkout as an opportunity. And what he has got to do now, very firmly, is go to the American people and make it clear that he will never support deficit reduction which does what the Republicans want. And that is move towards a balanced budget on the backs of the elderly, the sick, the children, and the poor. And you know what? If he does that, he is going to have the American people in huge numbers on his side.
When Mitch McConnell says, oh, they want tax increases, what we are talking about is undoing Bush’s tax breaks for the rich, plugging loopholes which allow millionaires and billionaires to stash their money in the Cayman Islands and not pay a nickel in taxes. When we say that we want to address those issues, the American people are with us. The President must take that fight to the people.
Cenk Uygur: Senator Sanders, I wished the President would listen to you. That would be awesome, that would be perfectly logical, you would have the people behind you. I really doubt it. So I am going to ask you a question about whether you think the White House is a little naïve or somehow the fix is in. Because I want to show you a clip from earlier, after we gave away all those tax cuts again to the rich, the President was asked about what is going to happen during these negotiations. And an interesting response. Let’s look at this:
Obama: “When you say that they will have a significant amount of leverage over the White House, what do you mean….Here’s my expectation, and I will take John Boehner at his word, that nobody, Democrat or Republican, is willing to see the full faith and credit of the United States government collapse. That that would not be a good thing to happen.”
Cenk Uygur: Senator Sanders, when I saw that happening when it happened, I was like, really, is he going to take Boehner at his word? I look at that and I really wonder, and you are in Washington, and you are a Senator, and you know better than I do, I think can he possibly mean that? Does he really think that Boehner would say, oh, yeah, I will do whatever you want, I will just do what I told you that I was going to do….
Senator Sanders: The President understands that for the first time in our history not paying our debts in a world economy which is on very shaky grounds would be a very bad thing. And the President is clearly right.
But on the other hand, what we also know, Cenk, is the Republicans are tough. Yeah, they understand the repercussions of this but they are prepared to take it to the President. And I think the dynamic of it is that they assume that they are going to be firm and that they are going to prevail and that the White House and the Democrats will collapse.
And again, the absurdity of this is that the vast majority of the people support the Democratic proposal. And what the President has got to say is if you Republicans choose not to raise the debt ceiling, if you choose for the first time in American history not to pay our debts, and if we enter a depression, or huge kinds of financial instability, the American people will know that that financial responsibility is on your shoulders. You are the ones who have done it. You refused to compromise and you have done it and we are going to take the case to the American people.
But to keep backtracking, to keep capitulating, I think is not what the American people want. You know, we talk in a general sense of a trillion dollars in cuts. Do you know what we are talking about? We are talking about throwing millions and millions of people off Medicaid, we are talking about making it impossible for working class families to send their kids to college. We are talking about cuts that are in nutrition, which will increase the amount of hunger.
This is a lot of pain that the Republicans are tossing out while they want to protect their rich friends. The President has got to stand tall, take the case to the American people, and hold the Republicans responsible if the debt ceiling is not raised and the repercussions are bad.
Cenk Uygur: Senator Sanders, to buttress your point, I want to give you another poll on the Paul Ryan’s plan. The American people hate it. 57% saying that we would be worse off, 34% saying we would be better off. Those are terrible numbers obviously for the Republicans.
So we got the wind at our back. But my guess is, my very, very strong hunch is, that we are going to come out of this with, they are going to take some tax loopholes away, and there’s going to be a deal at the end, but they are actually going to lower corporate taxes. When that happens, I cannot begin to tell you the disappointment in real Americans. I have seen it in poll after poll. What’s going to happen in Washington, are they just going to go along with….?
Senator Sanders: All I can tell you, Cenk, is I am going to be on the floor, I believe, at 4 PM Monday talking about this issue. This is bad public policy. The middle class is collapsing, they don’t deserve cuts, the rich are getting richer, they have got to pay their fair share of taxes.
And second of all, this is what the American people believe in. They believe in the concept of shared sacrifice, not balancing the budget on the most vulnerable people in this country. So I am going to do my best. And the American people have got to chime in very loudly and say, hey, Mr. President, stand with us, stand with us, and be prepared to take on the big monied interests. We will be at your back.
Cenk Uygur: Alright, that would be fantastic. Senator Bernie Sanders, as always, a great pleasure. Thank you for joining us.
Senator Sanders: My pleasure.
Cenk Uygur: Alright, and now with me, Dana Milbank, national political correspondent with the Washington Post, and Michael Steele, former RNC chairman and MSNBC contributor. I want to talk to you guys a little bit about why Cantor did this, why the Republicans did it, and how does this all play out.
First of all, Dana, it is also possible of course, and not just possible, certainly at least a part of the equation, is that Cantor is doing this in relationship to John Boehner. Tell the audience how that plays out.
Dana Milbank: Right. At first blush it sounds like take your children to work day up there on Capitol Hill with Eric Cantor being petulant. But there is a sense that he may be doing the bad cop thing so that Boehner can do the good cop thing.
Look, everybody knows what the deal involves. They have got these basic cuts that they want to do if the Republicans can yield on tax revenues. That doesn’t mean higher tax rates. It just means getting rid of these loopholes. Then Democrats will yield on entitlements, particularly Medicare. Then you have a deal. You can’t get a deal otherwise.
So the idea is this allows Eric Cantor to build up his credentials with the Tea Party crowd that he is very popular with. Let John Boehner go in there and take the hit for a deal that ultimately has some sort of tax revenue increases that it has to have.
Cenk Uygur: Yeah, and that’s the inside politics of it within the Republican party, too. But Michael, as you look at the actual budget negotiations, so you got the taking away of these loopholes, isn’t that the most reasonable thing in the world? Don’t we have got to look at the revenue side?
Michael Steele: Oh, yeah, I think we do down the road, and the question is at what point on that journey do you do that.
Cenk Uygur: But not right now—
Michael Steele: Well, that is where we always like to start and it is an easy place to start. The hard place to really start is with the cuts. How much are we willing to pare back on in terms of our spending. And what Dana laid out is good on the inside the politics side, I think. On the tax and spending, and what the American people perceive more broadly, the Republicans want that to be a serious part of the discussion.
Cenk, in a real sense, your problem is less with Republicans and more with the Democrats in terms of what they are willing to come to the table with and how firm they are prepared to stand so that we do have this very, I think, important discussion about the relative role of spending with respective to entitlements and all the other programs that are on the table right now.
Cenk Uygur: Well, you are mostly right, Michael. My problem is with the Democrats because they won’t kick the Republicans’ ass. You got the American people behind you. Why don’t you just go in and fight? It looks like their hearts are not into it.
Michael Steele: But Cenk, what are you kicking our ass with and over?
Cenk Uygur: Taxes. I want to raise taxes on the rich. The majority of Americans want to raise taxes on the rich. If you raise taxes on the rich, you create 23 million jobs under Clinton. If you lower taxes as Bush did, you lose 1 million jobs over 10 years. I got the facts, I got the American people, I’m going to fight.
Michael Steele: You are all loopy on the facts….
Cenk Uygur: What do you mean loopy? There they are.
Michael Steele: But you are not taking into account that under that period that you are talking about, and they are two good periods to contrast, look at the level of spending when you had Clinton and the Republicans working together to reduce spending and increase the revenue through lower taxes and you have more spending under the Bush terms while you are at the same time cutting taxes. You just can’t do it both that way.
Cenk Uygur: But, Michael, here is what everybody tells me on the Republican side. If we just cut taxes, the economy will magically grow. But we did. We cut taxes for ten (10) years and it tanked. You guys were wrong. I wish the Democrats would make that case. I got to go to Dana. Dana, when you look at the Democratic side, isn’t the real problem that they don’t believe any of this? I mean, they never take the fight to them. I mean, look at Mark Warner saying he wants to cut corporate taxes. Is that what we are going to get at the end? Is this all kabuki theatre, and at the end, all the Democrats and Republicans have made a secret deal anyway, and then they are going to come out and say, yeah, we are going to raise the debt ceiling, and by the way, we are going to lower corporate taxes?
Dana Milbank: The silliest part of all of this is that the Democrats don’t even have to be on this position of raising taxes for anybody. They can just say, look, we are just getting rid of all of these loopholes. If you do that, you can actually lower taxes for everybody.
But what I don’t understand here is that it seems that Obama is almost sticking it to the Left here, like it is some sort of humiliation here, and it has been going on with the budget talks, with tax cuts, it is going on with Libya, it is going on with Afghanistan. You can see that the Democratic members particularly in the House are just livid with what is going on, but they feel powerless, there is nothing that they can do, they cannot challenge him, they can scream and yell like Bernie Sanders did, but ultimately they are stuck and they really cannot persuade this White House.
Cenk Uygur: They are stuck with a Democratic President who is not really Progressive and as you said, he is almost rubbing it in their face. Alright, that is great. I love being stuck that way. By the way, I bet that really works out for him when he is looking for votes. Yeah, that is a great winning strategy.
Anyway, Dana Milbank and Michael Steele, we have got to leave it right there. We are out of time. I love you guys. We will talk again soon. Okay?
Michael Steele: You got it, buddy.
Transcribed by the Barefoot Accountant of Accountants CPA Hartford, Connecticut, LLC
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