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tv   Up w Steve Kornacki  MSNBC  April 14, 2013 5:00am-7:00am PDT

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as an american express cardmember you can expect some help. but what you might not expect, is you can get all this with a prepaid card. spends like cash. feels like membership. good morning from new york. i'm steve. los angeles lakers superstar kobe bryant underwent surgery late yesterday to repair what was described as a complete rupture of the achilles tendon in his left leg. it should take bryant six to nip months to recover, meaning there is a chance he could return for the start of next season. right now i am joined by democratic congressman jerry nadler of new york, mark blithe,
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the author of "austerity: the history of a dangerous idea," president and ceo of the center for american progress, and former new york governor eliot spitzer. president obama sent his proposed federal budget for the 2014 fiscal year to congress on wednesday. plan calls for $1.8 trillion in deficit reduction over the next decade, which, together with actions that congress and the president have already taken, would apt to the much sought after goal of $4 trillion in total deficit reduction. the president has long championed. to get there, obama's budget offers a mix of new tax revenue and spending cuts including a controversial provision to recalculate social security payments, in effect, cutting them. right now the amount of money retirees get from the government each year is based in part on changes to the consumer price index or cpi, the dominant way of measuring inflation. when inflation goes um, social security recipients see their payments go up to keep pace with cost of living. president obama is proposing
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switching to a chained cpi which would amount to a cut in social security benefits because chained cpi rises much more slowly than the regular cpi. the white house is sending signals to its allies that the chain cpi proposal is really just an attempt to expose republican intransigence by demonstrating that even when the president includes a measure republicans say they support, they still refuse to cooperate with him. when he unveiled the budget, the president challenged republicans to hammer out a compromise. >> when it comes to deficit reduction, i've already met republicans more than half way so in the coming days and weeks i hope that republicans will come forward and demonstrate that there really is serious -- as serious about the deficits and debt as they claim to be. >> since the chain cpi proposal became public, progressive democrats in congress have excoriated the president, predicting that it would vail. chris van hollen told "the huffington post," "there's the concern republicans will see
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this budget as the starting point of the conversation and not the end point. even though this budget was clearly an effort by the president to signal a willingness to compromise, the history of these negotiations show that republicans will try to pocket these concessions then make more demands." it's unclear whether the chain cpi proposal is a ploy or whether he genuinely believes in the necessity of entitlement reform, or maybe it's both. there does seem to be ample evidence going back to the beginning of his presidency that he is committed to the cause of deficit reduction, calls for a grand bargain and a balanced approach has been hallmarks of his presidency. as early as january of 2009, before he even took office, he pledged to reform medicare and social security in an interview with "the washington post," saying there would be "very difficult choices and issues of sacrifice and responsibility and duty" under his presidency. and in this notable line from his 2010 state of the union address, he echoed pro austerity talking points comparing the
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government's budge tote that of a family's. >> like any cash-strapped family, we will work within a budget to invest in what we need and sacrifice what we don't. >> so i want to start with you, congressman nadler. there's a story in "the new york times" today about the growing, you know, frustration of democrats with what obama is offering here in terms of, you know, more means testing on medicare, more specifically with the chain cpi we just described. you have been one of the leading critics of the chain cpi proposal. "the new york times" is talking in terms of, you know, threats being made by democratic activists, against democratic members, if you go with this, you'll get a primary challenge in 2014, if you're interested in running for president in 2016, you won't expect support then. what is your sense of where things stand among democrats in the house right now if -- a big hypothetical, but if republicans were to say, you know what, there's something to this, we want to explore it. could obama count on much support from democrats in the house? >> i don't know about "much."
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i think the majority of the party wouldn't vote for it under any circumstances. i certainly hope not. there is real disgust with this proposal. first of all, remember, social security has nothing to do with the deficit, shouldn't even be talked about in this context. second of all, the chain cpi is a cut and not just in social security, a cut in ssi, a cut in veterans' benefit, an increase in taxes for the middle clas, which is a direct violation of the president's pledge not to increase taxes for people under $250,000. it would do all those things and it is totally unnecessary & destructive of the social welfare network. we always said that senior citizens should have a three-legged stool to rely on -- pension, social security, and savings. pensions to a large extent are gone from the private sector. the 401(k) is a failed experiment. the average person is retiring with $80,000, which is nothing
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in terms of throwing off annual income. people are relying only on social security. the average social security check is somewhere in the neighborhood of $16,000, $17,000 a year, and we're telling people that's too much? this is just absolutely wrong. >> i think what progressive activists, the people i'm talking about making the threats about re-election campaigns, i think what they're trying to figure out is would democrats in the house actually stop this, because obama sort of went down this road before when he was pursuing the grand bargain in 2011 with john boehner and they sent signals then they'd be open to something similar to this. the expectation was, yeah, there will be democrats in the house who vote against it but nancy pelosi would ultimately support ift. do you think there's more frustration? would democrats actually stop this from happening? >> a lot of democrats would. i can't speak for everyone, obviously. i don't know how many would. but a lot of democrats will not vote for this under any circumstances. i would hope there wouldn't be
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enough republicans to vote for it. this thing should not pass, period. >> what's your sense on this? are you sensing among progressives the frustration i'm talking about? >> i think the frustration is really in where we are, which is we've gone through several negotiations, and, you know, obviously there's a lot of angst and anxiety about chain cpi but the added anxiety is that this will be the start of negotiations, not the end point. people are also worried about what else will come into a negotiation because you saw already the republican response to the president's budget was if these are good ideas, why don't we just do them and not talk act revenue. so i think it's the mixture of obviously there's concern about chain cpi, but there's really also concern about what the president is willing to give up in addition because these are all his starting points, not end points.
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>> there's a sense this white house has always lost the negotiations. in an effort to appear reasonable he's put so much on the table that at every moment, he's given away what we've needed to preserve and in the end given away much more, whether with wall street, on the social compact with the entitlement programs. there is not the notion there should be some form of entitlement reform down the road, but this is a horrendous idea. even if you accepted the premise, and i'm with jerry, not with social security which doesn't add to the deficit, but if you wanted to raise the level of income that was us is peptable to the payroll tax, do it in creative ways so the wealthy contribute more, you could do that to remedy whatever social security issues there are. medicare, medicaid, medicare, if you wanted to do some sort of means testing, okay, talk about some things that are interesting. but not this. why lead with this and why give away what is so fundamental? >> what you're asking seems to be the question that's sort of hovered over the entire obama presidency, because as we played in that clip from 2010, "the
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washington post" from 2009, this idea of sort of bowing to the consensus, this sort of elite consensus about how deficits are the single biggest problem facing the country. that's been a hallmark of where obama has been for four years now. >> i think it's basic mistake. if you look at the deficit, we brought it down to last year and this year about 5.5. that's the largest deficit reduction, demobilization after world war ii. it is too fast. it is inhibiting economic growth and employment. the president wants to get down too far. once you're below 3% gdp, the national debt as a percentage of gdp so s going down as things stabilize and that's what you want to get to. but the deficit is not our immediate problem. our immediate problem is an economies which is going to stay at 7.6% unemployment
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indefinitely. already we have a contractionary fiscal, inhibiting the economic. from an economic point of view, we should be increasing the deficit right now somewhat, worry about it later, but get jobs and get the economy moving again. >> like i say, this is the story of the obama presidency, the story of the stimulus. it should be bigger, economists argue, but you had concerns about the deficit, keep it under $800 billion. >> it's worse now. then you had a political argument that you can't make it bigger than arbitrary number, a trillion dollars, whatever, even though you should, we can't. okay. now the president is buying into the republican rhetoric as he has been, but he is now saying -- he's saying we should keep half the sequester, which is destructive, and the other half should be tax reform. yes, we should have tax reform, but he shouldn't be feeding into the republican talking points that the deficit is the problem right now. we ought to be decreasing spending right now. >> in fairness, there are
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investments in the president's budget. he does have additional investments. he does have a very important universal proposal. it's not entirely austerity. it is trying to be a mix between revenue and spending cuts but also some important investments. i would say, however, that people do lose sight of the fact that we've had $2.5 trillion in deficit reduction. it has been imbalanced so far. it continues to be a little imbalanced but it's imbalanced already. we have close to $2 trillion in spending cuts with $600 billion in revenue. and the issue here is that we really need to get more revenue on the table for long-term deficit reduction. i completely agree that we should not be doing things like sequester right now, which is dragging down the economy. we should be investing. and we should have deficit reduction. but it should be more in the long term. >> first of all, the president by embracing the metaphor of we are a family, therefore, like every family we must balance our budget, that's embracing the
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republican misinformation. the government isn't a family. we can have long-term deficit spending. that is the history of presidents that invest. there's good deficit spending and bad deficit spending. there's deficit spending for good programs that return on investment like any business, and there's deficit spending that is wasteful that should be cut. there is a little subtlety to this that the president, as the leader of the nation, needs to explain about what we're doing and why. that's what we need to here. >> in fairness, you know, president obama the last four years is not the first major democrat on the national stage to make a big deal about deficits. this story goes back generations. we have a pretty fun video that's going to make an important point in the context to this and we'll play it as soon as we come back. 7 socks and 6 weeks of sleep but one thing you don't want to lose is any more teeth. if you wear a partial, you are almost twice as likely to lose your supporting teeth. new poligrip and polident for partials
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so i want to take you on a brief video tour of i getsz we could call it deficit hysteria from some democrats you might recognize going back about 30 years. let's just play this and talk about it. >> the american people see this debt and they know it's got to come down, and if it won't come down, the economy's going to slow down, maybe go into a recession. >> we cannot and should not depend on higher tax revenues to roll in and redeem every costly program. >> the financing of those programs to ever more public debt violates our generation's responsibility. >> that, ladies and gentlemen, that is the legacy of the bush years, the slowest economic growth for any four-year presidential term since herbert hoover. an economy crippled by debt and deficit.
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>> he promised to balance the budget, but he hasn't even tried. in fact, the budget he has submitted to congress nearly doubled the debt. >> we now have over $9 trillion of debt that we are going to have to pay back. $30,000 for every man, woman, and child. that's irresponsible. it's unpatriotic. >> i think mainly what that video prove, and those are just a few examples -- you can find plenty of republican and democratic examples over the generations -- it is irresistible to any politician politician to rail against deficits. it's scary to people. the bigger the number is, the scarier it gets. mark, you write about it in this book. all the conversation about chain cpi on the table, steps to get to a great bargain, a balanced budget, all that flows from the political power of sort of deficit hysteria and it is a
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superficial level incredibly appealing to voters, isn't it? >> it certainly is. there are pretty obvious reasons why. you try to explain this on the notion of fallacy of competition, you lose them warfare you even start. the whole idea you have to save is contingent upon someone having income. they spend the income, you have to save. the government being a family, completely fallacious. first of all, the united states issues the global reserve asset that everybody else needs to earn in order to conduct foreign trade. families don't get to do that. i don't get to import people to my family and tax them for the next three generations. governments get to do that. you have to take that next step. there's also a political dynamic. there's a procyclical bias to accumulating debt, regardless of the country. king said back in the day, the time for the start is the boom not the slump. at the top of the boom, when houses are going up in volume, everybody's having a good time, what's the reward in congress
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for standing up and saying let's raise some taxes? that's when you have to do it. you get this positive convexity in the system that it keeps going up, then you get to a certain point where in 2007, for example, at least on republican side, saying 61% debt to gdp, oh, my god, we're all going to die. so the financial crisis happened, you bail the global financial system, where the debt comes from, and suddenly after peeling out the assets of the very people who have taken out the income growth for the past 30 year, they turn around and say, look at all that debt, that's shocking. there's been an orgy of public spending. i take amtrak every day. i noted. >> those points are brilliant. dichotomy between wall street's view of debt, when they are the ones incurring it, the leverage ratios that ran their very institutions, debt juiced their bonuses and returns, they loved it. of course as you said we bailed them out. the moment government has debt to invest public programs,
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somehow it violates the principles of economics. it is completely inconsistent and wrong. and i think nobody has really hammered home their schizophrenia about debt. our debt is good debt if we do it the right way. theirs is for the wrong reasons. >> again, you just quoted keynes who said you should spend during a recession and have debt and during the good times you should pay down the deficit. that's exactly right. some of the quotes you saw was the result of doing exactly the opposite. when ronald ray gab took office, the national debt of the united states from george washington through jimmy carter was $794 billion. when george bush left office after three republican administrations it was $4.3 trillion. in relatively good times. they quadrupled the debt. under clinton it started coming down. and in fact we balanced the budgets.
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>> surplus. >> we balanced the budget, had a surplus for the last three years. under george bush it wept up again because of the tax cuts and because of two unfunded wars and so forth. again, the debts are not all the same. it depends on the state of the economy. now we have a large debt as a percentage of gdp, although not nearly as large as at some points in our history, and what we ought to do is pay that down but pay it down basically for the way we did it the 15 years after world war ii by economic growth, not by following policies that will stifle growth and that will put burdens on middle-class people. >> i think this discussion highlights the -- how the opposition -- the republican opposition the president is facing is sort of hypocritical because the truth is we could have deficit reduction or tax cults. it was massive tax cuts. the bush tax cuts are the number-one reason why we have really the debt that we have,
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that and the wars. it's not spending. it's those two items. really, whether we agree with it or not, this budget does highlight the fact that the republicans have made a choice and it is always to have tax cuts. tax cults are the policy above issues. when they have a choice between deficit reduction or reducing the debt or tax cuts, they always choose tax cuts. >> the point the congress is making is an interesting one because if keynes is right and the time for austerity is the good times, when you had a surplus, that's when we -- and the tame same thing in the reagan years, but there's anothers will son from the last 30 years of history and that is that the sort of deficit talk rhetoric is never more appealing to the public than the time when you most need deficits. >> be, there's another lesson, too, and we have no to not forget the history. the republican party du not care about deficits at all despite their rhetoric. vice president cheney, you said ronald reagan taught us deficits
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don't count. they care about reducing government expenditures, putting it in the bathtub where they can drown it, to quote grover norquist. we are at the end of a 30-year end of starving the beast. then you can use that to destroy and social expenditure programs you never liked in the first place like medicare, medicaid, social security, all kinds of programs. you never liked them but couldn't get rid of them, couldn't reduce them, and this is the culmination of that. >> i want to talk about -- we have talked about the appeal of anti-deficit -- of deficit messages. i want to talk about realistically if there are any way os for people to combat that because it is so powerful. ten hut! you up for the challenge suds-maker? i'm gonna need more than that to get through the rest of these dishes! i want more suds! dawn? you won't last.
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by earning a degree in the field maof counseling or psychologyth from capella university, health. you'll have the knowledge to make a difference in the lives of others. let's get started at try running four.ning a restaurant is hard, fortunately we've got ink. it gives us 5x the rewards on our internet, phone charges and cable, plus at office supply stores. rewards we put right back into our business. this is the only thing we've ever wanted to do and ink helps us do it. make your mark with ink from chase. so i think there's some mythology that's built up around for franklin delano roosevelt
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and part of it has to do with the new deal and the deficit spending in the 1930s. we look back and say fdr rallied the country behind the new deal, public spending, massive investments in public spending. the reality is when he ran against herbert noovr 1932, he ran against the deficit. we have this great quote. i want to put it on the screen. he makes the exact comparison that obama made in 2010. "the credit of the family depends chiefly on whether that family is living within it income, and that is equally true of the nation." he's making that exact same family/nation comparison. the other story of the roosevelt presidency is four years into the new deal in 1937 he had -- you know, people whispered in his ear, you have to worry about the deficit. he said we have to go after the deficit, the mistake of 37, when he went after usausterity, joblessness went up, growth declined. >> and they had a disast rout election in 1938. >> absolutely.
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you can trace this basic challenge. we can knock obama for saying he hasn't explained the need for deficit spending so much but this is a challenge that has bedeviled leaders going back as far as at least fdr. i wonder is it possible to excel keynesian economics at a massive level. >> i'm persuaded it is but it takes a lot of hard work. fix the roof when the sun is shining. but there are ways to explain the core economics. the public would get it. but it would take a concerted effort over many years and that is where i think the white house has failed, whether it was obama care, which wasn't properly explained, why it made sense to have everybody participate from an insurance perspective, the stimulus, which was a huge success. they were afraid to explain why it was working and put the numbers up on the chart, this is long-term difficult communication but can be done. that is the role -- >> there's a dysfunctional problem with this, as well. you had the past 30 years, the economy let alone 2007 and the
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bailouts. and the problem with this is you don't have real wage growth. and when you don't, basically, why do americans always go for the tax cut? because they need a lot of disposable income, because things cost a lot, because your public goods underfunded aren't any good. basically the minute you walk up and say i want to take more money out of your wallet and spend it on somebody you don't know, it's a loser even if it's the best time to do it. >> i don't think that's the argument facing. i think when you look at the public attitudes towards the deficits, they're aligned -- they're not so out of this -- you know, people are concerned about public spending but when you ask them about social security and medicare and investments in education, they want those investments to go up, not down. and they want tax cuts. they want to have taxes increased on wealthy americans. we're not in the period of the '90s or the '80s. people are really demanding increased taxes on wealthy people because they feel like they're not paying their fair share. you know, i do think there -- i
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don't know that we actually live in deficit hysteria because it's not like the american people want these entitlement cuts or cuts to services. >> i don't think there's a coincidence, though, that the deficit has spiked in terms -- when you poll the question you know, what are the top issues facing the country, we've seen three spikes over the last 30 years in when the deficit has scored highly on that. one was in the early 1980s during the reagan recession, one in the early 1990s, the ross perot presidential campaign in 1982, built entirely around the deficit, and the third time is basically since the crash, 2008, 2009, to the present. >> but nonetheless, if you poll -- first of all, because people keep telling them. the republicans keep telling people and the president echoes it that economic growth will go down if you don't rein in the deficit, which is simply wrong. they're not hearing from anybody to the contrary, which almost any intelligent economist will say is the case. but the fact is nonetheless, if you poll people and you say what
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is the biggest problem, you get huge numbers for unemployment to the economy, not -- >> is the problem this, that people conflate the deficit with the economy? to say the deficit is bad -- >> to some extent, but if you poll people and say would you rather spend money to increase employment at the cost of a higher deficit, the answer is yes. >> steve, people don't understand where the federal dollars are spent. there's the sense we spend it on foreign aid, and the concern about the deficit went up when we were bailing out the banks. understandable. people resented the bailout, said the deficit is putting money back on wall street. we don't like that. if the president or somebody explained where the dollars actually went and said here's why social security is not related to the deficit, here's why entitlements 30 years from now are so we need to fix that in the long term, but here's why structurally right now we need to spend on infrastructure. that argument would work. if at the moment the bailouts, my sense is if there had been a grand bargain, not how he think
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of it today, but bailout plus mortgage relief, people would have understood that that made sense and some of this hysteria, whether it's real or not, would have been tempered. that is the sort of transaction the public would get and that's how you have to explain it. >> where we are right now, this is year three of obama's pursuit of the grand bargain. that will be the story for the next few months. i want to bring it back and try to figure out what is going to happen in the next few months. progressive makes it easy, because we give you choices. you can pick where to get your car fixed, we can cut you a check, or, at our service center, we take care of everything for you. [ relaxing music playing ] [ chuckles ] -whew, so many choices. -take your time. -the service center. -okay. giving you choices -- now, that's progressive. call or click today. departure. hertz gold plus rewards also offers ereturn-- our fastest way to return your car. just note your mileage and zap !
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unconscionable assault on seniors with chain cpi, a republican-friendly proposal. if we take the white house on its word, intransigence exposed, the grand bargain argument goes nowhere. you still have a republican house through 2014. where do all these fiscal talks go if this is a dead end? >> i think it is a dead end. i don't think the republicans are going to move an inch. i think playing 11th dimensional chess may work in string theory and physics but not in the real world. but i don't think it goes anywhere. i think that we'll get another continuing resolution down the road, it will just be a continuing of the austerity policies we have now, nothing is going to change much. the economy will continue in a bad shape and the democrats are going to be blamed because obama won't be -- and the democrats generally are not shifting and saying we need to produce jobs. we're not doing the proper rhetoric. i think the other thing that's going to happen is we'll have a
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huge crisis this summer over raising the debt ceiling again. now, maybe the republicans will back down. they're saying they'll last for another $2 trillion in cuts beyond what we've already done if you need a dollar-for-dollar reduction for debt ceiling increase. that's not doable. simply not doable. >> negotiate on the debt ceiling. the president should not negotiate on the debt ceiling. if this budget is part of a negotiation, that's a the wrong strategy. they're saying they won't negotiate on the debt ceiling and they shouldn't because every time -- >> okay, but this is my frustration with that, because i heard that line in december in the run-up to the fiscal cliff talks. when the deal was cut on new year's eve, five minutes before new year's eve, the line was, you know, they did not include a faux long-term extension of the debt ceiling, they did not address sequestration -- >> two months. >> there was business in that. >> and, and, and, instead of extending the bush tax cuts for people under $400,000 for a year
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so that they would have bargaining leverage now when this comes up, or a couple months when this comes up, they extended it forever -- >> there are two issues which the white house has permitted to get away from it each time there has been a negotiation, the filibuster and the debt ceiling. those two simply must and should have been resolved years ago because they continue to start with good policy, with -- come back to your point, mark, the crisis and jerry's point, what will happen several years from now is median family income will continue to decline because none of the fundamental structural issues are being addressed. at the end of the eight years of the obama presidency, my great concern is the middle class will wake up and say it just didn't work, not because the president didn't articulate good policy, it's because he couldn't effectuate them. >> people won't realize that. >> they won't. >> let's go global since we live in a global economy.
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there's this enormous recession in europe because of policy and austerity, which you would think let would be a big signal to everybody, let's not do that. put that to the side. one of the consequences and causes is the europeans forgot to build themselves a fiscal system. they don't have one. they can't do anything but squeeze liquidity and pray, which is what they're doing. we're the ones who are growing. so the argument is let's be more like them. but the american fiscal system, congress used to work. now it's completely deadlocked. the two most important sources of growth in the global economy, neither have a functioning fiscal system. that's a huge problem. that's uncharted territory. we have not been there before. the consequence of this, they're trying to do too much because they're the only part of the policymaking system that's doing anything. at the end of the day, you can only do so much with liquidity. it's pushing on a piece of string. >> mark blyth, the author of "austerity: the history of a dangerous idea," thanks for joining us.
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we've been talking about austerity, why it drives the political conversation despite the economy's glaring need for more demand and how contradictory public attitudes towards us a thor ti seem to be. when it comes to opinions on specific us a the ter ti measures, the divide between wealthy americans and the rest of the country is stark, due in part to the fact there are far more built-in protections in the system for the affluent than working and middle-class americans. with tax day tomorrow, we're all probably giving considerable thought to our tax burlds and liabilities. with president obama proposing nearly $600 billion in new tax revenue over the next ten years as part of the 2014 federal budget, the question of whether and how much to tax high earners will likely be a major part of debate in washington in the spring and summer. i want to explore how we as taxpaye
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taxpayers swrakt with the tax code. we have democratic congressman jerry nadler, maddie dougler from americans for tax reform, ne neera tanden and david k. johnston, author of "the fine print: how big companies use plain english to rob you blind." that is a great title. ? thank you. so i guess to set this up, we have a graph here i want to show. we said in the intro that more built-in protections for the wealthy. this kind of illustrates it. what this shows are basically the cost of tax expenditures, sort of the loopholes and deductions you hear about, the tuition tax credit, child care tax credit, these things. look at the share of federal spending that comes from that and look at all these other programs -- medicare, medicaid, social security, entitlement programs, then nondefense discretionary, defense, and the divide is when you compare the tax expenditures which are
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locked into the tax code and awfully hard to undo, then the nondefense discretionary, always the first thing on the chopping block. help lower nc people pay for college or, you know -- >> middle-income. >> care for their children. a lot of these tax breaks, the tax expenditures are designed to do the same thing except they disproportionately benefit the wealthy. that's what these added protections are that i'm talking about. yet again, it seems like as we say the tax debate we're having this year, we have the sequester hitting the nondefense discretionary, we have the entitlement programs, social security and medicare, on the table, and still only a vague discussion of some kind of need for reforming the loopholes and the deductions. that always seems to be the discussion we're having on taxes, david. >> well, yes, and the tax expenditu expenditures, a lot of which go to middle-class people, many are upside down subsidies like the
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housing subsidy for the mortgage interest deduction. the more you make, the bigger your subsidy. but what's not in the tax expenditure budget is just as important. if you are wealthy enough that your annual increase in wealth exceeds your consumption, you just borrow against your assets and live tax tree. $17,000 a year if you can afford it. i'm older. i can save an extra $6,000. but if you're an executive, a large business owner, a movie star, you can save unlimited amounts of money under a little-known section of the tax code, and there are people with multiple billion-dollar untaxed fortunes and some are done in the way they can borrow against them. that's something seriously wrong with the system. that's why we need to talk act fundamental tax reform and lowering rates would make all these things worse and put the burden on the people down the income ladder. >> fundamental tax reform, comprehensive tax reform.
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we did it in 1986, 27 years ago, and heard about it every year since. >> that's one of the problems. every time i hear the republicans and someone else saying we've got to have tax reform, eliminate the loopholes and lower the rates to be revenue neutral, that was done in 1986, and the rates stayed low but the tax loopholes came back one by one as the lobbyists went to work in congress. again, you get a system with lower tax rates on rich people than you used to have, and all the tax loopholes back. so if a tax loophole does not serve a good economic or social purpose like encouraging them to build more daycare centers or something which is justifiable and justifiable for the amount of money, it ought to be repealed. it has nothing to do with the tax rates, which is something else. >> jerry, not only do i totally agree but importantly a lot of these tax loopholes go to unproductive activities. if we're going to have tax
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expenditures, let's do them for things that add value and grow our economy. housing doesn't do that for you. it's an unproductive activity, consumption. >> let's be clear what it is we're talking about, loopholes, et cetera. really there are these tax expenditures are credits, refundable credits. >> some of them are. >> but this is the point, is that this is a -- >> most of them are not. >> this is a completion of what we're talking act, saying that it's a benefit that benefits higher income earners, when it does that, it is on the tax side but when it's a refundability given an access of someone's liable, then it's on the -- >> that's not what we're talking about. >> this is the question, though. if we're talking about tax reform, what space is in these tax expenditures for tax reform? 1986 made the tax code more progressive and that's not necessarily a bad thing for someone -- >> it did not make the tax code more progressive. >> my point is if you're looking to eliminate tax expenditures,
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to use your parlance, then you can use those to lower rates or for something else, be, you can't say it's all on the spending side or all on the tax side. >> wait a second. let's set the ground rules here. no one is talking act eliminating all tax expenditures. >> correct. >> two, a tax expenditure has to be looked at as an appropriation. is it worthwhile, how much does it cost, does it serve a function? the difference between a tax expenditure and appropriation is you have to reappropriate money every year. once you enact the expenditure, it stays there forever until you repeal it. >> look what's happened in the last ten years, '01, '03, 2010. you had to live through this in washington about reupping, you know, expiring tax relief. is that an ideal situation? i don't quite understand. >> this is going to be -- you know, we talked in the first few seconds of the show all about sort of the social spending side. now we're talking about the tax side. tax reform is the thing that president obama says he is looking for in exchange for all
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these cuts he's seeking in the safety net. let's talk act the tax reform as he would call it he's seeking and what it is republicans might accept and whether there's any point in doing tax reform at all, after this. oh, it's cheryl burke! who's this guy? security. cheryl, hi! i know you don't need one but would you try on the depend silhouette for charity? right now? under this? why not? for charity? now's the perfect time, cause with soft fabric and waistband, the best protection looks, fits and feels just like underwear. even doing the chacha. whaaat? ok, america. cheryl burke tried the depend silhouette. get a free sample so you can too. but first you've got to get him to say, "hello." new crest 3d white arctic fresh toothpaste. use it with these 3d white products, and whiten your teeth in just 2 days. new crest 3d white toothpaste. life opens up when you do.
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the discussion in washington is part two of obama's second-term quest to get more revenue. that's what he ran on in 2012 and says he has a mandate to deliver on and the basic argument from the white house is we have given a lot more on the deficit reduction and the spending cut side in the past couple years than we have got from revenue so we are going to get more revenue. we're talking about tax expenditures. >> i would quibble on one thing you just said. >> sure. >> the bush tax cuts were deliberately designed to expire in ten years because at the time it was predicted that if they lasted longer they would generate huge deficits. >> hide the deficits. >> they would generate huge deficits so they were made as a condition of passing to what
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extent pyre in ten years. not extending part of the bush tax cuts is not raising the taxes. >> we actually raised the deficit by not getting rid of -- but still, looking at the sort of congress casting votes, the politics of this stuff is that in the public's eye counted as he got more revenue. now the case is we need more revenue and we're looking not at income tax hikes as much as the deductions in the loopholes we're talking about in exchange for the safety net cuts. >> here's the problem with that. two things. number one, per capita adjusted for inflation, the federal government is taking in a third less money than it was in 2000. the bush tax cuts did not deliver what they promised. incomes didn't go up for everybody. we're not better off. we have big deficit. complete failure there. the second is this enormous explosion of incomes at the top. you've probably seen my chart. $59 after 45 years for the bottom 90% average increased income, $18 million for the 1%
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of the 1%, that's one inch to five miles. the people at the top, that's money largely the result not of better mouse traps, smarter economics, it's government policy, redistributing upward. and government should be taxing back that money that it basically gave to people through these policies that allow people to escape taxes, defer taxes, earn money they wouldn't be able to earn but for the government's rules. that's not market economics. >> how are you disagreeing? i don't understand the difference. the president is proposing to look at tax reform in a way that changes these deductions so that the deductions are actually -- that the credits -- so that you actually get rid of the, in fairness, in the tax code. these deductions are structured as, i think you agree, in the way they give much more benefit to wealthy americans. >> yes. >> we think we should convert them to tax credits so they're better for middle-class families. but that's actually what the president's proposing. he's trying to unskew the system
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of the -- >> but the president's dividing line is $250,000 a year of quarter annual income. that's two doctors married to each other, a detective married to an anesthesiology nurse. we have people who make multimillion dollar per day incomes. why should someone like that have the same marginal tax rate as someone who works all year and has two jobs? >> now you're talking about the fact we used to have 25 different tax brackets in this country. >> correct. >> we had six, and now we have seven. but the highest tax rate kicks in at about $400,000, but you're taxed the same on that -- >> as on your $4 million. >> as on your four billionth dollar. that's why some of us are sponsoring legislation in congress to put another tax bracket, 41% on a million dollars income, 42% and so on up to about 45%. we ought to go in that direction. >> no more deferrals. >> foreign deferrals. >> all deferrals.
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>> no one would disagree. you can do both things. no one would disagree with the fact that the tax expenditure system is highly skewed towards the wealthy and we need to change that as well. >> there is a discussion here, too. a key part of this in terms of where this is going on a policy stand point depends on the republicans in washington but a, again, obama is looking for this bargain and we're hearing all the old talk about we're not giving in any more on revenue. your take on that after a break. ? no. okay. this, won't take long will it? no, not at all. how many of these can we do on our budget? more than you think. that didn't take very long, did it? this spring, dig in and save. that's nice. post it. already did. more saving. more doing. that's the power of the home depot. dig in and save with miracle-gro potting mix, a special buy at two bags for just $10. we asked total strangers to watch it for us.
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seems to be engaged is basically his view trading off the reduction in social security, the more means testing of medicare for getting rid of some of these loopholes and deductions in a way that would increase revenue. that's the key. this is the second pass at getting the revenue the white house wants to take at this year. to me this looks like this is falling back on the same basic fault line that's driven politics nor the last generation, which is the republican position has been let's talk about deductions, talk act loopholes, but anything we eliminate there, anything we cut out there, we want to make up for by lowering the rates overall. the key for republicans is revenue neutral. the key for obama and democrats is increasing revenue. is that an accurate take on where you stand? you can't get more revenue from tax reform? >> sure. revenue neutrality is a republican ideal but not a republican idea. 19 l 86, there was bipartisan agreement that tomorrow needed to be revenue neutral and that was good starting point and how they got something done eventually. looking at what the president
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has proposed, in favor of tomorrow, says his opening salvo with his budget is to give republicans something on entitlement reform so maybe they'll come to the table on revenues, two ways that i don't take him seriously. his budget brings up to 20% in terms of gdp in revenues which we have never reached in the modern area save for once in 2000. he's saying with all the tax increases and new rev knees he'll bring us up to 20% of gdp in revenues, not realistic. secondly, when he says he wants to offer entitlement reform, knowing that's the debate he wants to bring republicans in with, that is chain cpi with social security. what that amounts to is a middle-class income tax hike, because of the bracket creep that that introduces, that also cuts benefits for current beneficiaries. so if that's his entitlement reform bargaining chip and this is how he's looking at a tomorrow, i don't see it as a serious proposal. >> to the extent that's his
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bargaining chip is because so many republican voices for the past few years have been urging him to make that his big concession to them. >> right. >> we want chain cpi, we think there's a huge social security crisis, we think social security is contribute to the deficit, and so it's -- >> but i don't think it's chain cpi that's been the gold standard for anyone. it's the notion that we can be looking at how we're calculating benefits, the entire edifice of spending and taxes because obviously something is wrong if it's not keeping up with actual income growth. but i don't think -- nip is saying chain cpi is greatest -- >> mitch mcconnell has been saying do chain cpi. lots of republicans have. this is our conundrum, which is republicans want the president pob the one to come out for chain cpi, medicare reforms, set et cetera. once he's done it, then they creep away and say we're not serious. and i think, you know, the fact
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that the nrcc, the house republicans are attacking the president on chain cpi just like karl rove's group attacked the president on medicare cuts in 2010, in the 2010 elections, shows they want to have both sides of this. they're never going to do tax cuts and they want to hit the president for the entitlement reforms after demanding it as their price for deficit reduction for four years. >> it shows the political foolishness of the proposal. like charlie to the football. the republicans keep putting it out there and saying support chain cpi, support these things and the moment the president does they're going to attack the democrats for doing it. they did wit the medicare in 2010. it's political poison as well as being wrong sub stan tichly. one other thing that was said a moment ago, and that is that, yes, we're asking -- asking for 20% gdp in taxes and it's going to go higher. it's going to have to go to 22%
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probably over time because as our population annals more people -- a larger percentage of the population will be on medicare, a larger percentage on social security, and even though social security is self-financing, it does not add to the budget deficit, does not really affect the budget deficit, you pay into it and take out of it, but it's figured as if it were part of the budget deficit. so the percentage that government uses counting social security has to go up simply because of the demographics of the population. and the only -- let me say this. the only thing that is really controllable, unless you want to do things like start cutting social security benefits, which is discretionary spending as a percentage of the budget and the gdp going way down, if the president gets his way, the republicans are far worse, but if the president gets his way, it will be nondefense discretionary spending or maybe discretionary spending, which will be 1.7% of gdp in 15 year, now 3.1%, it's already nondiscretionary defense -- nondefense discretionary
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spending is already the lowest -- >> but what i think you're getting at here is to me is a very interesting point about all this is that you ask people specific questions about the size and scope of government, about -- you ask philosophically about the size and scope of government, they want a small government, a lean government. they think it's too big right now. you ask them about safety net programs, they are all very pop gr you lar and as you're saying it costs money if you're going to have the kind of safety net that people in individual questions say they want. >> because of what eliot spitzer said, people don't know what the federal government spends money on. we're spending less and less as a percent of the economy and in absolute terms on things like aid for kids to go to college today. college is becoming unafforda e unaffordable. almost any social expenditure, we're spending less. >> we have an interesting graphic here. they also don't realize is at a basic level what they're paying in taxes or what's happening in
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terms of tax policy. this is a couple years old. this is asked if president obama increased or decreased taxes. this is a poll from 2010. you remember the stimulus, the big thing in the stimulus was like the tax cults to 95% of the public. did you get an obama tax cut? 8% of people said that obama cut their taxes. 33% said he increased them. 50% said they were kept the same. when you get a tax cut, people are supposed to want, and this was real, happened, showed up in their paychecks p. >> that's a comment on the president's failure to explain what he was doing. >> exactly. >> i agree with you. >> and the president's failure to explain what was going on. >> i find this dfsh the challenge that tax policy has for middle-class americans is wages have declined. we have a ten-year wage decline. so people have gotten these tax cuts but their wages have
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declined, too, so their absolute wealth is increasing with these tax cults. not just a failure to communicate. what i would say to my republican friends is that the central thesis of their economic growth strategy has been tax cuts. and tax cuts have proven, we have lived experience. we keep cutting taxes and growth goes down. fact for the period from 2000 to 2008, we had the worst growth rate of any presidency ever and the highest tax cuts in decades. that's what the problem -- we have a failed experiment that is the central thesis of the republican party. >> that's not the central thesis of the republican party. it's one of their tenets. >> it drives all of their policies. >> but you also have explosive government growth. you've got government spending that's out of control, and that -- >> it's not out of control. it's not out of control. >> congress volts for it. >> an explosion --
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>> -- sh rining under obama. >> after spent 84%. seriously, this is laugh that believe you're telling me these deficits -- >> this is -- this is -- >> in the depression. put us into a depression. >> i'm challenging your assertion that the deficit and the size of government is shrinking after obama and congressional democrats took spending and the size of government to all-time highs. >> this is the central lie of our political debate right now. >> absolutely. >> what you just said. the fact is what happened to our deficit -- after it was -- after it went down -- after it went up, rather, because of the bush tax cuts and the wars and every, but since obama took place, remember, the cbo before obama took office said the 2009 deficit was going to be $1.4 trillion, and it was. and it was hugely increased. why? because you get a recession or depression such as we're in, two things happen, one, revenues plummet, taxes plummet, people aren't working, don't pay taxes
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so, taxes plummeted. two, automatic spending on unemployment insurance and food stamps goes up because more people don't have money -- >> and if you don't have part two that you did, that's when you get the great depression. it it is a stabilizer. >> but the spending that can be controlled -- and by the way, when the recession ends then your unemployment insurance expenditures goes down and your tax revenues go up again. that's why you should have a big deficit during the recession. but the part of spending the congress can control, all the discretionary spending, has been going down, not up. >> that's because of what happened in 2011. republicans started cutting spending, with the debt limit debate. this is why discretionary spending is going down. the focus is not deficits. the deficit is just the delta between how much you're spending and how much you're taking in, which is too much from a small government perspective. and if you're talking about -- >> from a small perspective, i agree. >> if you want to talk about
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deficit, the president's budget is $2 trillion less in deficits than he estimated when he first a came into office. >> mattie, here's what i would like to see republicans support. we are going to be poorer in the future because we are cutting spending on basic research. the espn zones we all have grow from government spending in the past. the jet airplanes we fly come from government spending, the computers we use, the math in them all come from government spending. >> the engineers. >> right. we need to be spending money on research, development, and education. and the republicans want to cut all that. >> there needs to be priorities and we can't keep spending on everything we like. that is the question i want answered from you guys. if we have all these parties that are good ideas and we need the government to invest in them, how do we continue to fund those priorities? >> getting more revenue. >> americans for tax reform, mattie dupbler. thank you all for your time. ♪
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not even a decade ago democrats were running scared from karl rove's initiatives against gay marriage. four years ago, barack obama made it clear that he, too, still opposed gay marriage, and he won the presidency. but in just the last month, we witnessed a stunning domino effect of national democrats switching their positions and falling in line in favor of marriage equality. and it wasn't just out of power democrats like the clintons. two days before the supreme court heard oral arguments on the issue last month, missouri's claire mccaskill became the 38th senate democrat to endorse gay marriage. the next day, three more democrats followed suit, three more the day after that. less than 24 hours later, bob casey switched. tom carper did on april 2nd, bill nelson on april 4th, two
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more on april 5th. then with south dakota's tim johnson switching on april 8th, that meant that in just 16 days one quarter of all united states senate democrats had dropped their opposition to the right of all americans to marry regardless of gender leaving just three senate democrats who still oppose equal status under the law for gay couples. it's not just gay marriage equality where a progressive politics are insurgent. after 19 years of virtually unbroken indifference to gun control, even in the face of multiple mass shootings, democrats this week picked up just enough republican support in the senate to kill a filibuster and open debate on expanded background checks and stricter penalties for gun traffickers. even george w. bush couldn't get republicans ta pass immigration reform. the bipartisan senate gang of eight is soon expected to release an immigration blueprint that will include a path to citizenship. cultural issue, it's clear the democratic party has embraced an aggressively liberal posture. but now look at economic issues. wall street dramatically took hold of the democratic party in
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the 1990s when president clinton and treasury secretary robert rubin, who spent a quarter century at goldman sachs, embraced finance capital by appealing glass/steagall banking resolutions, by pushing through the north american free-trade agreement, cutting welfare and declaring an end to big government. president obama wanted to cut entitlements and released a new budget that embraces cuts to social security and medicare, leaving liberal members of congress anded a ka si groups howling that the president's proposal would chip away at the bedrock of social protections created by the new deal and the great society. obama is doing this even after wall street dramatically shifted its allegiance last year, throwing its weight behind mitt romney, who raised three times as much money from wall street the president did, was a far cry from 2008 when obama was wall street's man. the big story of the 2012 election was supposed to be the rise of what's been called the coalition of the ascendant, the younger, more rangers, well-educated voters who
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delivered obama a second term and who supposedly would enable democrats to pursue a progressive agenda. but so far, at least, that message is only getting through to democrats on social issues. want to talk about why and what it means after this. ♪ [ acoustic guitar: upbeat ] [ dog ] we found it together. on a walk, walk, walk. love to walk. yeah, we found that wonderful thing. and you smiled. and threw it. and i decided i would never, ever leave it anywhere. because that wonderful, bouncy, roll-around thing... had made you play. and that... had made you smile. [ announcer ] beneful. play. it's good for you.
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use it with these 3d white products, and whiten your teeth in just 2 days. new crest 3d white toothpaste. life opens up when you do. talking about the divide between democratic strength on social issues vest where they are on economic issues. here with jerry nadler, maiya wily from the center for social inclusion, neera tanden from the center for american progress, former governor elliott spitter from new york. i want to stay on the insurgence of progressivism on the cultural front. rick pearlstein wrote this book called nixon land about the cultural politics that powered the right and the republican party basically for a generation from the late '60s, trace it from nixon, the 70s, the 80s, reagan, even with george w. bush, the start of this decade. the only break of republican
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rule was bill clinton in the '90s, and it was the triangulation, how he managed the challenges of governing and being a politician in nixon land america. but as we said in that setup there, the cultural politics have completely changed with the rise of the coalition of the ascenda ascendant, these young voters, new voters, nonwhite voters, college-educated voters, they are liberal. liberalism is the winning side. >> it's actually -- what's fascinating about the moment is the wedge has moved entirely to the other side if you look at freedom to marry, same-sex marriage, that issue is now, you know, gone from 60% for, 30% against, reversed, and creating a big division in the republican party between the younger voters that they need, right, to be a gateway for voters under 40, and senior voters they're relying on. so it's a big challenge for them going forward. and i think it's a great irony that they lived up the toxic
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fumes of sort of wedge politics for decades and now those wedges are switching. that's a good thing in american politics. >> i would make a point not with any pride, that it has not been elected officials, politicians, who have weighed in on these issues. the democratic party is in a good position because we are following this tidal shift in the public on issues of same-sex marriage, on issues of immigration, guns, which is a bit more divisive, obviously, the environment. all these issues. the public, primarily because of the demographics we've been talking act, younger folks are say, wait a minute, we envisioned a different type of society. the democratic party's finally catching up to that, which it needs to do. >> with some exceptions. some have been real leaders. you forget that howard dean was practically -- lost his re-election campaign for governor of vermont in 2000 because he went for civil unions. >> the dean story is interesting, too, because a few years after that he was running
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for president and he sort of had the nixon land mentality a little bit. he had this line where he talked about he wanted the guys with confederate flags, their votes. >> to be self-indulgent, discussing the issue of driver's licenses for undocumented immigrants, and i was destroyed. now it's a law. so being ahead can be dangerous is the problem. >> some people were ahead. >> that is true. >> it's not just pure demographic shift. it's not just because there are young people. it's because there have been decades of organizing on these issues. part of what happens, and it's happening i think when we're point thog these issues of the disconnect on economic issues, economic justice issues, is the organizing on immigration, the organizing and coalition building and alliance building that actually pushes politicians on both sides of the aisle has been building for a long time with a lot of strategy and with a lot of losses. those losses always build towards victory over time. we are just starting to see a new generation of organizing and
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economic justice now, particularly coming out of the recession, and people trying to figure out how to build this new formal alliance coalition, particularly with young people across race, as a result, in order to win the minimum wage, in order to, you know, fight back on some of the -- at foreclosures, in order to figure out how to get more job creation, more investment in public education. so i think some of what we're seeing is that the cycle of organizing and activism is also more nascent on economic issues. >> that makes sense. i guess what i wonder, though, is sort of, you know, the story of the second two years of obama's first term, which were, you know, wasn't much to speak of legislatively that happened. total gridlock with republicans in congress. he took that message, pursued the grand bargain in 2011, and it didn't work. then he took the message to the country, i want higher taxes on the wealthy, i want to protect the social safety net. he won the resounding victory. he said, wow, this coalition of the ascendant is real. here we are in the second term, the agenda coming out of the
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white house right now is still -- we want chain cpi, want to do the medicare, want the grand bargain, want deficit reduction. >> he did get revenue. >> true. >> right out of the gate they got tax increases on the wealthy. and the president is fighting for minimum wage. it's not like there's no issues here. that is an important -- that is an important thing, which is also hugely popular. >> i think nonetheless there's a fum truth here. president is pushing in the right direction some of these things i would say too slowly and tim duncanly, but he's pushing in the right direction. i don't think we're going to get anywhere until we have a democratic congress with him because the republican party is locked in a position and will be there for quite a while. but the real question that you started raising is here you have all this tremendous social progressivism and economic stand pattism at best. and partly it's because the generational shift and partly it's what you said a moment ago about all the organizing. but it doesn't necessarily
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follow that goes with the economics because when people get very upset about the economics, you could get a very right-wing shift as you see in europe and get very right-wing fascist reactions if the liberals don't seem to get economic progress. you saw that in the '30s and you're seeing it again now. the central part i want to make is parties change over time. the republican party today is becoming an extraordinarily reactionary right-wing party on social issues a and on economic issues. the democratic party has become or is 90% becoming a very liberal party on social issues, and it's a considerably more conservative party on economic issues than it was 30 years ago. from my point of view, that's unfortunate but it's clearly the case. if the democratic party were socially -- was economically liberal as it was 30 years ago we wouldn't have the kind of private health insurance system that we just mandated. we would have a medicare for all. >> what happened? because i mean i guess the popular turning point in most
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minds comes back to the mid-90s, comes back to bill clinton and he sort of made the alips with wall street, the fist time you had this. was that the turning point? >> that's part of it. maiya's point as well, no organizing around the issues of economics and we intellectually embraced a deregulatory model, a free-market model. i'm a cappist, i believe in free marks. but you have to unction them and how they ripple, the consequences ripple through the economy. there's where maya's point comes in. you need organiegoganizing arou. >> there are two realities important to lift up. and there's a new study out of the university of michigan on this. politicians have gotten public opinion wrong. they actually make the wrong judgment about where their constituents stand on issues. the polls are actually significantly better including minimum wage, right? 50% of republicans support a $9 minimum wage that the president is proposing, 70% of all polled.
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same with medicaid. only 8% of republicans feel there should be major cuts in medicaid on polling. i actually think there's a lot more bipartisanship in the -- >> let me pick up on one thing that jerry said which is so important about leading the anger to the right point and ma what maya was saying. if anybody tried to take the anger of the tea party and direct it towards a new understanding of what actually led to the cataclysm, all that energy that became an intentionally conservative anti-government deregulatory force could have been shifted towards a more sensible centrist position. maybe not liberal but centrist. that's what we're missing. >> there was a group. it was called occupy wall street. >> but they didn't articulate well. >> but, look, i think the president won in part because he created a contrast on economics versus the supply side. i think it's unfair to say he's
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done nothing. we had wall street reform. we should make that stronger but it's not like nothing was done. look, the reason why those dollars were skewed 3-1, why wall street, you know, the numbers went, because they were angry the president did anything on wall street reform. >> exactly right. >> so, you know, so i don't think we should say nothing has happened. >> no, no. >> and there's actually -- you know, we're talking -- i sort of set this up looking at the obama budge net the context of well, the democratic party is more liberal on the culture front than it is on the economic front, but there is a counterargument that actually the obama budget is affirmation and validation of what happened in the 2012 election. i want to get to that after this. everyone's retirement dream is different;
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demands are politically. again we talked about how the electorate is becoming decreasingly, the highest share of nonwhite vote ever in 2012, overwhelming for obama. college-educated voters breaking for obama, single women breaking for obama, young people, millennials breaking for obama. that's the coalition of the ascendant. there was a column from ron brownstein in the "national journal" that said the budget obama unveiled this week actually fits perfectly with the demands of that coalition because we can talk about chain cpi and restraining the entitlement programs, the safety net programs a little, but his point is think generationally. you're talking about restraining spending on programs that benefit the elderly, social security and medicare, and also there's pre-k, universal pre-k, college aid in there, infrastructure bank there. it's about sort of a generational shift in priorities. he's saying it's responding to that coalition. congressman -- couple people shaking their heads. >> thank you, because it's a conservative talking point that they are in conflict, that we're spending too much on the old people and not enough on the
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young. the fact you're spending more on old people because there are more of them, but we're spending less as a percentage of our budget and gdp on everybody else. we should be spending more on education and housing and on job creation. and yes, the coalition of the ascendant in the sense the population is increasing and they're there politically. but economically they're getting killed. young people, there are no jobs, minorities, there are no jobs. all these people are getting killed economically, and we've got to do something about that. now, the president's budget does a little about that. my contention is we should do a lot more in infrastructure spending, in nondefensive discretionary spending on things like helping kids get through college without mortgaging their grandchildren, their banks and so forth. >> here's the thing. young people actually because of the politics and the political debate around social security for the past several years, have actually ceded the issue not
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intentionally, meaning it's not because young people don't want social security or don't support social security. they've just been led to believe it's already gone. that's actually changed what they believe the opportunity for them is. that's not the same thing as saying they think it's an us/them issue with elderly versus universal pre-k. >> yeah. no. i guess i would say -- i just disagree a little bit about the president's budget. i mean, i think the single most important thing we can do to address long-term inequality is actually invest in children, 0 to 5. the universal pre-k proposal is a great proposal. it's an important proposal for families. it's a great proposal for improving our educational outcomes. it's been successful in the past. i do think we should recognize that the president is making good investments. is it everything everybody wants? no, but in a constrained period, the fact he's increasing investments in children, increasing investments in higher education is what we need to do for a long-term competitiveness.
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i agree we shouldn't be taking it out of other areas. we shouldn't look at this generational conflict, but we should applaud these areas of investment and say they're the right thing to do over the long term, not just because of the coalition, although that's been helpful, but because it will help our long-term economic greet growth. >> i'm with neera on this. the budget is a small feint in the right direction. >> i was a little more positive. >> i know. >> it's nice to be with you. >> let me explain why. the long-term issue here is job creation and wage stagnation. to overcome both of those, we need to change our terms of trade with the rest of the world, invest in human capital. >> absolutely. >> invest in growth going forward. in the global world, the paradigm has shifted. unless we have smarter workers, the technology and capital is mobile, only human capital determine where is jobs are created. >> it goes wicoalesces with the
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president's coalition. these are younger voters and higher, well hef educated voters. the big issues that millennium generation folks are progressive on social issues but also recognize that we need to invest education for our long-term growth. >> the consensus in the party and the reason why there's so much traction on obviously gay marriage but you can look at gun control, take the red state senators out, the red state senators out, there is consensus in the party about gun control and these other cultural issues. that's where the consensus is because that's where mass opinion is in the party, where the elected officials are in the party, also where the donor class in the party is. there's -- i just want to play this. i think it's kind of telling. this is mr. wall street. this is lloyd blankfein on gay marriage. >> i'm lloyd blankfein, chairman and ceo of goldman sachs, and i support marriage equal. america's corporations learned long ago that quality is just good business and is the right thing to do. >> this is not just about him
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but this typifies where the donor class of the democratic party is right now. absolute consensus as best i can tell on gay marriage, absolutely for it for perm reasons, business reasons, whatever the reasons are. but when you get into questions about the budget i think the donor class' agenda might be very different from where the rest of the party is. >> and in fact studies have shown that if you poll people on key economic issues, they take the so-called liberal side of the economic issues, if you poll rich people, they take the other side of the issues, and it's the -- it's that that most politicians are reacting to. >> if the president is just kowtowing to wall street, that' a bad move since wall street has shifted dramatically -- >> by the way, if i framed that the wrong way, that's on me. i'm not saying this is obama kowtowing to wall street. i'm talking more generally about the conversation in the democratic party and in politics is how much is that being driven by --
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>> but what i think actually what is interesting about the 2012 election was you saw that identity politics did trump economic politics. if you look at for an example of asian-americans. asian-americans have higher wages, higher average income than even whites. they went -- they were the second highest voting bloc for the president. why did that happen? i mean, after african-americans, asians went -- they were 75-25. why did that happen? because the republican party attacked people, seemed to say to people that the president wasn't really american, that there was a single definition of american, and people internalized that. i think asian-americans were, like, if a person named barack obama -- >> the social issues. >> but let me just say i think what was fascinating is people with higher incomes were voting on identity politics. i think we shouldn't say that that's a bad thing. people -- >> no. i -- >> people respect it in the political process. and that's something that we should also applaud. it shouldn't be something that we just say that's not
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important. >> not applauding not condemning. i want to understand how the interests and the priorities of the donor class are shaping the debate. we have some people here who are or have been on the phone with donors before. i want to talk about that. and people trying to get to these people. man: the charcoal went out already? ... forget it. vo: there's more barbeque time in every bag of kingsford original charcoal. kingsford. slow down and grill.
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mr. wiggles and curling irons. for the little mishaps you feel, use neosporin to help you heal. it kills germs so you heal four days faster neosporin. also try neosporin eczema essentials. the chicago area, they tested attitudes of the wealthy and everybody else toward the concept op cutting programs to balance the programs like medicare education to balance the federal budget. 58% of the wealthy said let's do it. 27% of everybody else did. that's the divide i was getting at in the last segment. maya, you are coming up against that divide i imagine every day convincing officials to make things a priority. how big a role do you see money -- >> money is huge. if i could write a check for $100 million, i bet i could get them do a lot of stuff i want themd to do.
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unfortunately, i can't. i think there are two things. there are two types of power. one is the checkbook, and one is the constituency base. and that's why i think one of the things we're seeing is some of those donors also decide whether they're going to support the constituency base in terms of organizing. when we talk about the fact there hasn't been as much -- there has been a lot but not the same amount we've seen in other pockets -- it's also because who writes checks for communities to organize and make those demands because there is a way to counterbalance. we have to deal with money and politics, but we saw it with guns this week. >> let me agree but put a different spin on it. your premise right but i want to use the language jerry used. not just the donor class, the elite chatter class. there's a consensus that emerges in the plutocracy, an editorial board, et cetera, that takes as a premise, going back to the deficit conversation, begins with the premise we must cut the deficit. it doesn't step back and say
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wait a minute, maybe that's wrong. what maya -- >> i want to follow up on that because you were in politics. you were on the phone with donors. i imagine your conversations, you were talking to these elite people. how much did that -- did you find that disor thing your thinking at all? >> no, but also understand i wanted to personalize and not be too self-retchial, but i was not always the fan of that elite donor class because of my relationship with wall street, where many reside, they wouldn't give to me. i don't think i was swayed by them. >> did you see others -- >> of course. absolutely. >> but it's not just -- what elliott said a moment ago is key. it's not just or eve than that toe nors are saying i'll give you money if you get rid of the deficit and to hell with everything else. the elite opinion becomes this so when you talk to people they're assuming ha. >> can i remind everybody the president raised a billion dollars and his first act was to raise taxes?
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>> i don't want this to be -- i tried hard. this is not framed as this is not what obama does. just talking about the system. >> no. just a large point. i'm just saying there are a lot of donors, wealthy donors, who give to politicians who raise their taxes p. >> yes, there are, which is why -- >> so it can't be like a single -- saying it's a little grayer than -- >> sure. of course. >> there are -- >> it may slant the opinion but -- >> that's the point. >> in this election, the issue of taxes for wealthy people was the most salient issue in the entire election. >> yes. >> and donors did give to one party that was raising taxes. >> but that's missing the main point. yes, of course there are liberal donors who give even against what they perceive their own self-interest because they're patriots and think the being bigger good is different. but the fact is when the dominant elite opinion -- you saw that chart a moment ago -- is so completely different from public opinion, that has an effect, especially when you've
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completely concentrated wealth in a very small percentage of society, which you didn't do 30, 40 years ago, when unions are much smaller percentage of the electorate and of the ability to support political people. it skews the debate entirely. when i first joined the political club when i was in college, i joined the local political club, any political club is a gossip society, people involved, interested in politics. and the chief item of gossip in any political club is have you heard so and so seeking money for what you call it. today it's how much money can you raise. that's the difference in politics and that controls almost everything else. >> all right. so what should we know for the news week ahead? answers after this. while a body in motion tends to stay in motion. staying active can actually ease arthritis symptoms. but if you have arthritis, staying active can be difficult. prescription celebrex can help relieve arthritis pain so your body can stay in motion. because just one 200mg celebrex a day
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so what should you know for the week coming up? you should know that margaret thatcher's funeral will be held on wednesday in london. a lot has been written and debated about what her legacy means for women, labor, politics
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and conservatism. politicians were quick to herald her leadership and toughness, not entirely unwarranted. postmortems have been far more mixed and the britain she presided over had high joblessness and inkwee all the. we'll see how she's eulogized on wednesday and discussing her legacy next weekend here on "up." your opinion on president obama's call to repeal the 1975 public affairs act may reveal a lot about our country's polarization. a joint study found that when they told republicans and democrats that some say the act should be repealed, 11% of republicans agreed and 6% of democrats agreed. but when they said that president obama says the public affairs act of 1975 should be repealed, that only 3% of republicans agreed while 39% disagreed. here's what you really should
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know about this. there is no 1975 public affairs act. the pollsters made it up to see what influence drives polling results other than facts. before democrats get too self-satisfied when the pollsters said that republicans say the public affairs act should be repealed, democratic opposition rocketed up to 28%. basing where your political opponents stand is not basis. but the right answer in all polls is the answer too few of us admit to ourselves when complicated real questions come up. that's i don't know. finally, you should know about the latest chapter in the amazing adventures of former michigan congressman thaddeus mckotter who filed a -- for what he alleges was a plot to sabotage his political career by forging signatures on his primary petition that got him kicked off the ballot last summer with several months remaining on his term. you should know that mckotter had had quite a unique career in
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politics. he was part of a series on you-tube called rock solid in which he played guitar while talking about unemployment, libya and berlusconi. he became a fixture on red eye show where he was urged to run for the republican presidential nomination. which he did in 2011 for three months. he mainly attracted attention by fayning indifference to the gop debates from which he was excluded. beforist abrupt resignation, he had written a pilot for a raunchy tv variety show called bumper sticker, made on motown. if they wanted to sabotage his career, they would have re-elected him. i want to find out what my guests think we should know. congressman nadler. >> despite the fact that he mckotter looks like a twin
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brother of russian president put in. we'll know what the senate gang of 8 comes up with in terms of the immigration bill. we'll know whether they're excluding or not several million people or not by putting in an early termination date. we'll know how long the path to citizenship, whether reasonable or 30 years. and we'll know whether, as many people fear, they will throw the gay and lesbian community overboard by saying gay and lesbian partners cannot sponsor their own partners for immigration under the family reunification provisions of the bill. >> you should know that banks are going to continue to congratulate themselves on renegotiating the second home mortgages on some of the 4 million people in foreclosure while they are sending foreclosure notices because they are not renegotiating on the primary mortgage of homeowners and we're going to continue to see families thrown out of their
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homes. >> you should know that as comprehensive immigration reform legislation, i hope legislation is unveiled that the center for american progress has a report that shows a good bill will increase our economic growth by $830 billion and add 121,000 jobs a year. that's why it's important. it's comprehensive and has a fast path decision. >> all that's important. we'll know whether the winning streak for new york teams is going to be real or a moment. knicks, rangers, nets, all blazing right now. can it last? this is what's important. >> i say boo. child of massachusetts. my thanks to congressman nadler, neera tanden and eliot spitzer. thank you for joining us. we'll be back next weekend saturday and sunday at 8:00 eastern. our guests includes martin
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bashir. coming up next is melissa harris-perry on today's mhp. the uproar over jay-z and beyonce in cuba. that's melissa harris-perry coming up next. we'll see you next week here on "up." thank you orville and wilbur... ...amelia... neil and buzz: for teaching us that you can't create the future... by clinging to the past. and with that: you're history. instead of looking behind... delta is looking beyond. 80 thousand of us investing billions... in everything from the best experiences below... to the finest comforts above. we're not simply saluting history... we're making it.
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