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Tackling The Deficit Stalemate: What To Cap And Cut

Dec 5, 2012
Originally published on December 5, 2012 12:55 pm
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After House Speaker John Boehner proposed a deficit reduction package that included $800 billion of increased revenue, some within his Republican Party objected loudly. Senator Jim DeMint called it an $800 billion tax hike that will destroy American jobs, but even so it doesn't come close to President Obama's demand to repeal the Bush-era tax cuts on the wealthiest two percent. Today, House Republicans called on President Obama to sit down and talk with them, but some in the party worry that the president appears to have the upper hand. Freshman Republican Congressman James Lankford bemoaned his party's bargaining position.

REPRESENTATIVE JAMES LANKFORD: It's a terrible position because by default the Democrats get what they want. They get spending decreases in defense on a very significant level, and they get tax rates to go up to the Clinton level that they all over and over again say we like the Clinton tax rates. They get that by default.

CONAN: Earlier this week, we heard from two analysts with very different views on how to resolve the stalemate on taxes and spending before the New Year's deadline. Tomorrow, a key Democrat, Senator Sheldon Whitehouse; today, Republican Congressman Jason Chaffetz of Utah, who serves on the House Budget Committee. He joins us now from a studio on Capitol Hill. Good to have you with us, sir.


CONAN: And as - the president says he campaigned on that repeal of the Bush tax cuts. Does the election matter?

CHAFFETZ: Of course the election matters, and essentially the country voted for the status quo. The House is still in Republican control, and the Senate is still in Democrats' control, and the president is still in the White House. But let's also remember that the president also said that he wanted a balanced approach. He did want to tackle the deficit, and the other side of that equation is spending cuts, and thus far the president has been elusive at best in trying to specify what those potential cuts would be.

CONAN: Elusiveness cuts both ways. House Republicans have been vague on what kinds of revenue increases those 800 - would be in those $800 billion.

CHAFFETZ: Well, of course we've said we don't want to increase the actual rate itself, and that's where I think Speaker Boehner is moving in the right direction and where conservatives can feel a degree of comfort. Now, getting rid of the loopholes, that is something that should have bipartisan support. Now, which ones those are and how deep they go is obviously subject to debate, but that's really what the parties both need to do, is get to the table, and I think Speaker Boehner has done an exceptional job of saying, look, we're willing to consider these things that we've said we wouldn't in the past, but we've got to cut to the table and actually discuss them.

CONAN: And by bipartisan support, I don't mean to put words in your mouth - are you suggesting that if something hypothetically as popular as the mortgage deduction, the mortgage interest deduction, were to be part of that package, you'd want some Democrats to take the hit too?

CHAFFETZ: That's going to be much more difficult than some of the others. Maybe there's a way to, as Governor Romney suggested in the campaign, put a cap on overall deductions, so you don't necessarily limit home mortgages or charitable deductions. You know, you could take a mix, but you would cap out at a certain point. That's something worth discussing, but I think both sides legitimately don't want to negotiate against themselves. What's important to me is that Speaker Boehner and the other relevant parties sit down in the room together. That's going to take some presidential leadership, and thus far that's - it's been a little sparse, from the Republicans' view point.


KEN RUDIN, BYLINE: Congressman, about a year ago when the - shortly after the Republicans took that great victory and winning the House in 2010, the Democrats were offering basically 10 times - $10 in entitlement cuts for every $1 in taxes or whatever, tax increase, and the Republicans said no. It seems like the momentum has changed. I mean the Republicans probably had as good an offer they ever could have had, but they said no. And now it seems like the momentum has changed. Are you concerned that by most accounts, by many accounts, that the White House seems to be winning this PR war in the battle over what to do?

CHAFFETZ: I think, look, Republicans are disappointed that Governor Romney didn't become the next president of the United States. I'm certainly in that camp. But you know, we're getting over it. We got to move on. And look, the president will tell you that, hey, elections have consequences. But I would also remind - I too was elected and I've got to stand on my principles. And I think the country signaled that it does want a Republican House to be in check with the president. So no one person is going to get everything that they want. We all understand that. But this cliff is very real. We need the president at the table. It's going to take some leadership, and it's going to take some, you know, a real gut check to get through it.

RUDIN: But - I was going to say but did you make a mistake in not taking the deal offered last year when the terms seemed to be more favorable to your side?

CHAFFETZ: No. No. I think, you know, we stood for what we believed in then, and we will continue now. What's interesting when they make the argument about let's have increased taxes to the Clinton levels, you know, the Republican response should be, well, Mr. President and Democrats, are you willing to take the spending levels down to the Clinton era's spending levels because those hovered in the range of 19 percent where right now we're at 23 percent. And I don't think the Democrats would ever even come close to that. I'd love to see them try.

CONAN: Well, some Democrats might reply a large percentage of that growth has been to the defense budget since 9/11, of course, but a large percentage has been to the defense budget. Are Republicans willing to take the defense budget down to Clinton-era levels?

CHAFFETZ: Well, if we look at it as a percentage of GDP, I think there are those of us that, in this tumultuous world, are worried about what's happening or not happening in the military. Now, I have voted for and I believe - I have voted for cuts in spending to the military. I think there is some waste, fraud and abuse in there. I am deeply concerned about the money that we're still spending overseas. I advocated that we get out Afghanistan back in 2009 so - but nevertheless, I think there's ways to save money there, at the same time recognize that the projection of power and strength is a necessity for the United States of America.

RUDIN: Congressman, given the position that Speaker Boehner is in, who is going to have a tougher battle with: the so-called purists like yourself, the more conservatives, or with the White House and the Democrats?

CHAFFETZ: Well, look, I think we're actually - we had a conference meeting this morning with all the House Republicans. I think we're fairly united behind Speaker Boehner. We all have ideas and suggestions, you know, between the House and Senate. It's a body of 535. But I think the speaker is doing a great job. He represents us well. We stand behind him at this point. But the president needs to come to the table, and they need to have these discussions.

CONAN: At the same time, you hear that quote from Senator DeMint who certainly has some influence among people within the party, calling this Boehner's $800 billion tax increase. That's the offer that's on the table, already unacceptable to the White House.

CHAFFETZ: Well, again, and one of the key parts for me is, what are the spending cuts? Not things that are going to happen 10, 20 years from now, but what are the spending cuts that are going to happen this year? And that's where I really worry that the White House is not serious about actually making cuts.

CONAN: There is - where - what happens next? We've got, of course, until midnight New Year's Eve, but the deadline is actually quite a bit closer than that because, well, the president goes on vacation, Congress adjourns.


CHAFFETZ: Well, we don't have to, and the president may have to change his plans. There's nothing like a deadline to drive decisions. I actually - whatever date you put the deadline on, I think that the decision will probably be made then. This one happens to be at the end of the year. Hopefully, we can get it done before Christmas. I wish it was done tomorrow, but there are a lot of implications. You start going out and changing tax code and this and that, and the other, you know, the IRS and others, they got to reprogram things. You've got accountants that have software that needs to be adjusted. So there's a whole trickle-down effect whatever we end up doing, but hopefully we'll do it sooner rather than later.

RUDIN: A lot of people are saying that this is typical Washington that, you know, for all this drama and aggravation over the potential going over the cliff, everybody knows there's going to be a deal because nobody is going to allow the economic situation to just go and, you know, over the cliff. Do you think it's just part of the game?

CHAFFETZ: Well, it is typical Washington. I haven't been here this long. But again, everybody seems to push these things right to the deadline, and that's what we seem to be doing now.

CONAN: We'll give you a chance to cough into your sleeve there for just a second. We take down the microphone. And, Congressman Chaffetz can maybe get a sip of water and come back to us in just a minute. But this has happened to all of us who are on live radio. And believe me, it's nothing to be embarrassed about. Congressman, you back?


CHAFFETZ: Yes. Yes. Sorry about that.

CONAN: That's quite all right. Let me ask you. There is an aspect of this. Of course, this whole fiscal cliff was set up in a dispute over raising the debt limit. Boy, that was a year ago. It's coming up again as well. The White House would like to include a deal, if not permanent on the debt limit, but maybe at least this next one, to say it's time to stop using this to hold the budget hostage anymore. Is that going to be acceptable to the Republicans?

CHAFFETZ: Well, that's an absolutely nonstarter. There is no way we're interested in just allowing the federal government to continue to operate with a limitless credit card. I think it's a good check for the out-of-control spending, the understanding that, look, we cannot continue to perpetuate the debt that we have. It's just out of control. We paid more than $600 million a day in interest on our debt. We can't keep doing that.

CONAN: So then what is the incentive for the Democrats who - as you're party member Mr. Lankford said in that cut of tape, they get pretty much what they want if they step - if they allow the economy to go over the cliff. And according to the Pew survey that was just published today, two-thirds of the American people are going to blame the Republicans.

CHAFFETZ: Well, we got to do what's right, you know? And I got to vote for what I believe in is right. The reality of the Budget Control Act and other things is sequestration does happen. And I think Mr. Lankford makes a good point. There are a number of Democrats who want to see tax increases and massive reductions in defense spending. So it's not ideal. It's not what I voted for. But it's the reality of what happens on January 1.

CONAN: And if there is conviction amongst House Republicans that they will not vote to increase tax rates on the top 2 percent, which is the president's position, if there is conviction on his part, this is what I ran on. This is what I'm going to insist upon. If we then do go over the cliff, then you're in a very different situation, where there is going to be proposals for, well, not tax increases but tax cuts and not - and there will also be then votes on spending increases for things like defense.

CHAFFETZ: There are an infinite number of possibilities, and you can see why the imperative is to get through these now, allow members and the public to be able to have these out there so we can debate and discuss them. We both, you know, ran on campaigns and elections and principles. No one person is going to get everything they want. But we got to get to the table and do it right now. It should've been done a while ago, quite frankly.

CONAN: Jason Chaffetz, a Republican from Utah. We're talking about conversations on the fiscal cliff. Again, we've heard two different perspectives from analysts early in this week. Tomorrow, Sheldon Whitehouse, the Democratic congressman from Rhode Island, will join us. You're listening to TALK OF THE NATION from NPR News. And, Congressman, as you look ahead, what's your best guess right now?

CHAFFETZ: It's not what should happen. But if I had to guess what's going to happen, we'll be back here December 30 voting on something that nobody likes.


CHAFFETZ: That's just my honest assessment.

CONAN: Just ruining your vacation plans, I'm sure.

CHAFFETZ: Well, do you think anybody's crying for a congressman's vacation plans? Well, that's just what you sign up for here. So nobody's going to lose sleep over that one. We'll figure it out.


RUDIN: Congressman, of course, you're in Utah, and last time I checked, there are a lot of Republicans in Utah. And when Republicans do lose in Utah, it's because they're not conservative enough. But there are other Republicans around the country who may have been elected from much more closely divided districts. They may not be as free as somebody like yourself in a very staunch Republican district to just, you know, stick to a position and say, well, you know, and just go ahead with it and not budge.

CHAFFETZ: Look, I want to do what's right for the country. I - Utah is very conservative in its approach. You know, we have Democratic congressman in Jim Matheson. But at the same time, you know how they like to joke about my district is made up of conservatives and staunched conservatives. But, nevertheless, I want to do what's right for the country. I know I'm not going to get everything I want. But, you know, I want to fight for everything that I believe in, the constituents of Utah's 3rd Congressional District believe in. So we just believe that less government is better for this country and better for our way moving forward. Twenty three cents out of every dollar in the country is being spent by the federal government. That's just obscene to a lot of people in Utah.

RUDIN: A lot of the newspaper accounts I've seen says, you know, who will blink first? Are the media covering this as seriously as they should be and not so much as a political gain but a serious economic question?

CHAFFETZ: Well, I do, you know, sort of - what I thought about the presidential campaign - every single time you turn on the television, there is a story about a poll and a horse race and who's winning and what are the optics. It's just, you know, if you could talk about what's really going to happen to somebody's individual family, I tend to think that's more important. But this is getting a lot of coverage, and it should. And there are some big, weighty decisions. I just worry that, you know, December 23 or December 30 and when the public is truly distracted, we're going to do something ugly. That's been the history of the past, and I hope it's not what's going to happen in the future.

CONAN: This comes, of course, at the end of one Congress and could spill over into the beginning of another. How poisoned a pill is this? There's a lot that the president and the Republicans would like to get done in this next term.

CHAFFETZ: Well, I, you know, there are a number of bills and things that we have gotten down. I think the frustration at this point is more focused with the president. And a lot of us would point to the Bob Woodward book, which I think clearly pointed out that this is maybe something that the president does not like to do. He is not as engaged into it. There are a lot of old bulls, if you will, that have been around the block here in Congress, who would point to, say, a Bill Clinton or a Ronald Reagan, who are much more personally vested in working this through.

Anybody who's seen the movie "Lincoln" that just came out, the Steven Spielberg film, it really took the president to roll up his shirt sleeves, to get some hard things done. I don't know that this president has it in him, and I - and there are those of us that worry that he tries to kind of ride above it rather than roll up his shirt sleeves and get his fingernails dirty in the process.

CONAN: You're not worried that he's out there promising postal districts to retiring Republican congressmen?


CHAFFETZ: Well, no, yeah, that was the funny part of the movie. If you saw "Lincoln," that was a reference to, you know, a postmaster job that was out there. But no. It's important to have presidential leadership and very specific. And at least Speaker Boehner spoke with us this morning. The president has been absent in terms of providing specifics on spending cuts because we don't believe he wants to do any of those. He talks about a balanced approach but won't specify the specifics that we need to actually work through a deal.

CONAN: Congressman, thank you very much for your time. We appreciate it.

CHAFFETZ: Oh, thank you.

CONAN: Congressman Jason Chaffetz, a Republican member of the House Budget Committee, with us today from a studio on Capitol Hill. Again, tomorrow Senator Sheldon Whitehouse will join us. These are the people who are going to actually decide in Congress, Senate Democrats and House Republicans. They are the ones who are going to have to push this through. Ken Rudin, our Political Junkie, joined us here in Studio 3A. He will be back with us next week. Ken, as always, thanks very much.

RUDIN: Thank you, Neal.

CONAN: Tomorrow, Aro Shapiri(ph)...


RUDIN: Tomorrow.

CONAN: Tomorrow, Ari Shapiro is here with the look at a controversy swirling around a New York Post cover story. TALK OF THE NATION from NPR News. Transcript provided by NPR, Copyright NPR.