First, a question for Kennedy, in which he makes it clear that the solution to the nation's growing budget deficit must be spending cuts, and emphatically opposes tax hikes even on the wealthiest Americans:
MR. RUSSERT: Mr. Kennedy, Ms. Klobuchar said that we should roll back the Bush tax cut on those making over $200,000 a year, because the federal debt is now $8 trillion, and we have to get our finances in order, and this is a way of raising revenue.... [W]hat about rolling back the tax cut on those who make more than 200,000?
REP. KENNEDY: We have had six million new jobs. The economy was flat on its back after 9/11. We passed tax relief to reward, and people--to let them keep more of their hard-earned money. Families, small business, those that take risk and create jobs. Six million new jobs have been created. We cannot be raising taxes, putting this economy back on its back, and also not growing jobs.[...]
MR. RUSSERT: A Republican House, a Republican Senate, you have a $250 billion deficit, an $8 trillion debt.
REP. KENNEDY: There's no question that I would like the president to take a little bit more leadership on spending. There's no question that we have had obstruction in the U.S. Senate that has bogged down not only our ability to take
further steps on fiscal responsibility, but many other things as well. We do need to push forward and make sure that we have strong fiscal measures to keep spending under control.
And here's Klobuchar on her plans for reducing the deficit:
MR. RUSSERT: Ms. Klobuchar, 57,000 households in Minnesota make over $200,000 a year. A lot of small businesses, people who create the jobs. And you want to come along and pound them with a new tax increase by taking away their tax cut. Why?The glass-half-full way of evaluating this statement is to say that Klobuchar is at least expressing willingness to look at both sides of the ledger. The glass-half-empty approach would be to point out that Klobuchar is taking a pretty timid approach to evaluating the Bush tax cuts: basically she's saying that what Congress and the Bush administration have done to the tax code the last six years is just fine as it affects those earning under $200K.
MS. KLOBUCHAR: Let me talk about why this is important to me and important to the people of our state. Right now we're in a situation where our debt is approaching $9 trillion, where this administration and this Congress took a $200 billion surplus and turned it into $250 billion deficit. Why does this hurt the people in our state? It's not just some chart on a wall. One out of 12 of the federal tax dollars that they're paying goes to interest on this debt.
And this is my solution: I'm the only candidate in this race that has come out with a plan to balance the budget. First of all, let's look at those $70 billion that's being sheltered in the Cayman Islands and Bermuda for multi-millionaires. That report came out August 1. Get rid of those shelters. That takes in 70 billion. Next, look at capital gains. Not changing the rate, but having a third-party validator like brokerage houses post those because there's underpayment. That brings in $17 billion. Roll back the tax cuts to the Clinton levels, to the top 1 percent, the Clinton levels when we had record jobs produced in this country. That brings another $56 billion in.
The problem with this is twofold: first, the tax hikes she's identified here are obviously not enough to offset our current budget deficits. Second, at some point policymakers will have to translate this general promise--repealing tax cuts for those over $200K-- into a policy prescription, and it's hard to see how that happens. If this is campaign code for "bring back the estate tax," that's fine. But that's not what she said here-- and one of these days someone's gonna have to figure out what it really means.
Maybe it's absurd to expect a candidate to mention specific tax changes in a debate; maybe the "$200,000" thing is the level of specificity you can have without putting people to sleep. But repealing big chunks of the Bush tax cuts is a VERY defensible goal-- and it would be nice to see candidates will to say so in a way that tells people something specific.
On the spending side of the ledger, both candidates were pretty timid. Here's Klobuchar on her suggested spending cuts:
MR. RUSSERT: Discretionary spending, what programs do you cut?This exchange follows on the heels of Kennedy's spending-cut prescriptions:
MS. KLOBUCHAR: And you--well, let's start with the one the congressman voted for, the bridges to nowhere, the rain forest in Iowa, the waterless urinals in Michigan.
I'm the author of the line-item veto. I don't understand why we want to build a bridge to nowhere in Alaska, a rain forest in Iowa.So the main difference between the candidates on the spending side appears to be that Kennedy has an idea (if an incorrect one) about how to stop building the often-lamented "bridge to nowhere."
Neither side is saying anything even remotely brave on the spending side. And in this light, Klobuchar's recipe for restoring tax revenues seems pretty gutsy. [Check out this post for more on the $70 billion Cayman Island loophole she talks about above.] Let's hope that if she wins, she shows more willingness to take a hard look at every facet of the Bush tax cuts.