What's on Congress' agenda in the final weeks before the August recess? Our panel takes a look at what needs to happen, and what can realistically get done.
Ohio Congressman John Boehner is expected to be the next Speaker of the House. A panel of journalists joins Diane to discuss the challenges he faces within the Republican party and the possibilities for compromise with the Obama Administration.
- Major Garrett congressional correspondent, National Journal
- Susan Page Washington bureau chief for USA Today.
- Todd Purdum national editor, "Vanity Fair"
MS. DIANE REHMThanks for joining us. I'm Diane Rehm. House minority leader, John Boehner, has led strategy of opposition to Democratic legislation. Now expected to be speaker of a newly-elected Republican majority, his challenge becomes incorporating and managing factions within his party. Joining me to talk about the GOP blueprint for the House in the 112th Congress, Todd Purdum, national editor of Vanity Fair, Susan Page, Washington bureau chief for USA TODAY, and Major Garrett, congressional correspondent for the National Journal. Do join us, 800-433-8850. Send us your e-mail to firstname.lastname@example.org. Join us on Facebook. Send us a tweet. Good morning to everybody.
MS. SUSAN PAGEGood morning.
MR. TODD PURDUMGood morning.
MR. MAJOR GARRETTGood morning, Diane. It's great to be back.
REHMAnd, Major Garrett, it's good to have you back, I must say.
GARRETTI couldn't resist. I couldn't resist.
REHMLet me start with you. What will be the mandate for the new Republican majority coming into the House?
GARRETTI would say they view their mandate on policy in two ways, to reduce federal spending and begin a conversation with the country about dealing with federal debt -- that's one. Two, on policy is to make permanent, the Bush tax cuts. They believe that's what they were voted in to do. That's what they believe is the best economic policy. They also have a political mandate, which is quite different from the other two on policy. They have seen what has happened to congressional majorities in recent history. First, there was a 40-year stretch of congressional Democratic power that was ended in the election of 1994, which John Boehner observed up close. Then he was brought in with Newt Gingrich's so-called revolutionaries. They held power for 12 years.
GARRETTNow, House Democrats, after winning in 2006, held power for four years. The shortening of these cycles is not lost on this new Republican majority. They don't believe the era of entrenched, prolonged and maintainable congressional majorities is with us any longer. They believe they can be thrown out of office just as rapidly as they were thrown back into power. And as a result, you're going to see a Republican congressional majority that certainly heeds the voice from K Street. But it will spend much more time listening and out of Washington and making a conscious effort to listen to those, principally in the Tea Party but other Republicans and the other Independents who brought them into power, and taking their cues at least as much from them as they do the sort of "entrenched interest" here in Washington.
REHMTodd Purdum, how do you see it?
PURDUMWell, I think Major is right. I mean, the truth is we're in a period of great volatility in American politics. It's not unprecedented. The House changed hands four times between 1946 and 1954. And it would -- yo-yoed back and forth in a time of economic dislocation after World War II, the highly unpopular Korean War. I was reminded last week that in the 1950 midterms, when the Democrats got their clock clean, just two years after Harry Truman's come from behind victory, Truman's aide said it was the only time in his presidency that they remembered him being so much the worse for a bourbon that he had to be helped to bed aboard the presidential yacht. He could not make his way under his own power to bed.
PAGEWell, you know, the Republicans have a plan, but they have a task, too -- I mean, a difficult challenge in trying to hold together this more diverse caucus than they've had before. Because the people who had the energy in this election were the Tea Party-backed candidates who come in with an agenda of cutting spending by 20 percent, of -- some of them want to eliminate the Education Department, the Energy Department or -- you know, a really aggressive agenda. And on the other hand, you have some -- you have the return of some moderate Republicans who fared well into some of these swing districts.
PAGEI mean, most of this caucus is very conservative, but some of it is moderate. They need to hold their Tea Party voters, but they also need to try to hold on to the Independents who swung their way this time. So they come into -- they come, especially in the House, with a pretty good sized majority. They've made up all the ground they lost in 2006 and 2008, which were tough elections for Republicans, but not an easy task to go ahead for the two leaders, for John Boehner and Mitch McConnell.
REHMAnd John Boehner has outlined what he considers some of his top priorities, for example, no earmarks. He's talked about letting Americans read bills before the Congress votes on them, and as you said, Susan, cutting spending by 20 percent, which is something Eric Cantor has said. I would recommend to everyone that they read this morning's lead editorial in The Washington Post, which outlines what would have to be cut to achieve that 20 percent cut in spending. Major Garrett?
GARRETTRight. And The Pledge to America, the platform that Republicans nominally ran on -- I think they prepared the Pledge of America in ways that were utterly different from the way the Contract with America was put together. The Contract with America was put together because Newt Gingrich wanted to have a set of transformative ideas about the government that existed. The Pledge to America is about basically taking away what President Obama has achieved. The Contract with America was focused on entrenched Democratic policy for two decades or more. The Pledge to America is dedicated to eradicating the Obama agenda and stopping right there. If you look at the Republican agenda, it's really about taking the country back to Jan. 19, 2009 -- nothing more radical than that.
GARRETTKeep the Bush tax cuts, get rid of health care and get rid of most of the regulatory apparatus that President Obama has put in. It's a very personally focused agenda. It's all about Obama, whereas the contract with America was much more broadly about welfare, defense policy, the federal interaction with crime and all those other sorts of things. So in that respect, it will be a cohesive element that will keep the Republicans together because it's focused on the existing president. And as the majority in an opposition role, they will be more unified than they would be were they working for a Republican president.
REHMThe repeated phrase, Todd Purdum, is, it's Obama's agenda. And yet getting rid of Obama is also at the top of the list.
PURDUMWell, Sen. McConnell said that was his top priority, was to defeat President Obama in 2012 and make him a one-term president. I mean, you know, the truth is, in order to make the kind of spending cuts that they're talking about as a theoretical matter and to make the kind of deficit reduction they're talking about, they would have to do things that so far no one has really been willing to do.
REHMLike raise taxes.
PURDUMLike change entitlements, like raise taxes, and they would have to do things -- you know, it's a sharp contrast to what they're doing up to now with what David Cameron and his coalition government in Britain have proposed these, you know, transformative, really, deeply, serious cuts in the fabric of British life. And no one in America, except maybe Paul Ryan...
PURDUM...is talking about those kinds of things. And leader Boehner has given him a very wide birth this whole campaign season and been careful not to, in any way, endorse some of his ideas for sort of privatizing Social Security.
PAGEWell, true, except, of course, Paul Ryan is likely to be chairman of the budget committee, which gives him a pretty good platform to pursue a more, you know, a more -- a bolder, I guess, agenda than maybe the leaders would like. I mean, the rubber hits the road, right? Once you -- I mean, that's what happens when you win control of a body of Congress, a chamber of Congress. You have the opportunity and maybe the obligation to do some of the things you promised to do, and that's going to be hard.
PURDUMAnd the body where revenue measures must originate, you know?
REHMBut how realistic is it to say we're going to do away with the National Science Foundation, we're going to turn over to the states responsibility for items that heretofore the federal government has dealt with, and we're going to cut those amounts? How realistic is that?
PAGEI think completely unrealistic. I mean, the -- it's unrealistic because it would have to -- these spending measures would have to get to the Senate, which is still controlled by Democrats. And it would also have to get past the president, who is sure to veto them. But what you could definitely see is a kind of gridlock...
PAGE...beyond what we've become accustomed to, even in the past several years.
GARRETTMy colleague, Susan Davis, and I spent last week talking to about 20 or so of the newly elected members of the House Republican caucus. And we were surprised that the caricature of them as these sort of pitchfork-wielding zanies didn't really measure up. They seemed very pragmatic about their approach to this issue. So, look, we're going to try in the House. We can't do anything unless we get the votes ourselves, and if we get the votes ourselves, we'll give it to the Senate. The Senate may not do it. The president may veto it.
GARRETTBut the first thing we have to do is tell our constituents, who sent us to power, that we're going to do this. And I asked many of them, I said, are you prepared to put your life in Congress on the line, testing the proposition that your voters really sent you to bring back less and to give them less than they had before? And several of them -- Vicky Hartzler is a classic example from Missouri's 4th Congressional District. She beat a 17-term incumbent -- Ike Skelton, a beloved Democrat in Missouri. She said, I'm going to find out, and I'm prepared to find out.
PAGEAnd Kevin McCarthy, who is likely to be the whip, the new number three ranking Republican in the House and who recruited a lot of these candidates...
PAGE...I interviewed him just before the election. And he said they're prepared to vote over and over again on repealing health care. They'll vote to repeal the health care bill, and it'll die in the Senate. They'll vote to repeal it, and President Obama will veto it. They'll vote to repeal it again. He said they're perfectly prepared to do it.
REHMBut then how does that get anything accomplished?
PURDUMWell, what it might get accomplished is the reelection of President Obama if he plays his cards right, and, I mean, we saw with Bill Clinton that he was able. And a former Clinton aide over the weekend reminded me -- that's Rahm Emanuel -- that President Clinton did not immediately tact to the center in some sense because his defining debate was in the government shutdown, which he was preserving in his lights -- Social Security and Medicare -- and standing against the Republicans who twice shut down the government and lost badly by doing so. People like John Boehner remember how that blew up in their faces. So it'll be an interesting...
GARRETTAnd Boehner and Cantor and McCarthy, and even Paul Ryan, in an interview I did with him a week-and-a-half ago, essentially ruled out any shutdown scenario...
PAGEBut, you know, I'm struck by...
GARRETT...preemptively. We're not opening up our bidding and our approach on budget issues with that as a likely outcome.
PAGEYou know, I covered -- I was there in '94 covering that election. I went on the trip to Asia that the President Clinton took right after that. They were shell-shocked. They had no idea what they were going to do. I'm struck by how much further along we are this time around with every people knowing -- the Republicans knowing they don't want a budget showdown that (sounds like) shuts down the government and the White House knowing that it's going to have to really change strategy in a fundamental way.
REHMSusan Page of USA Today. We'll open the phone shortly. I look forward to hearing your questions, comments.
REHMAnd welcome back as we do a kind of preview of what to expect from the new Republican majority Congress. Here in the studio, Susan Page of USA Today, Major Garrett of National Journal, Todd Purdum of Vanity Fair. Do join us, 800-433-8850. I look forward to speaking with you. I want to ask you about the Bush tax cuts and whether, in fact, the lame duck Congress will deal with whether to make them permanent, whether to change it so it's just on those earning above $250,000 or whether they'll do nothing, Todd Purdum.
PURDUMWell, I don't have enough reporting to know what they'll actually do. But it seems logical that they could do something -- and they should do something -- in the lame duck Congress because there's an obvious room for compromise. I mean, they can make permanent the ones for people under $250,000, and they can have some kind of a one- or two- or three-year extension for the high-income people that would strike a middle ground between both sides and be logical. Now, I don't know whether President Obama -- he's laid down a pretty hard line on that question. In some ways, he's laid down a harder line than John Boehner himself, who at one point, you know, told...
REHMSeemed to be compromise, yeah.
PURDUMSeemed willing to at least entertain the idea that he wouldn't vote against tax cuts...
PURDUM...for those earning less than $250,000 a year, so -- if that was all he could get. But, you know, I'm hoping that they would do a logical thing and find a deal as -- maybe not borne up by the climate that they're already getting into.
PAGEI think it's possible they'll get a deal in the lame duck that includes extension of all the tax cuts. But as Todd says, perhaps for the reaching one for families under $250,000 a year than for those above it, although Eric Cantor, who we expect to be the majority leader in the new House, rejected that idea yesterday on a Sunday show, said he was against this idea of what they call decoupling those upper income tax breaks from everybody else. So I don't think it's clear. I think it is -- here's what I think is clear. The tax cuts are going to get extended, and they're going to get extended for upper income earners, too. It's just how long that extension is going to be that remains in question.
REHMBut how can Eric Cantor be out there saying, we want to cut the budget by 20 percent, yet we're going to leave these tax cuts for millionaires in place, Major?
GARRETTEric Cantor, John Boehner and the whole of the Republican conference in the House, the vast majority -- I would say, nearly all if not all the Republicans in the Senate -- believe that preserving the upper income tax cuts while benefiting those who are extremely wealthy in this country also benefits, according to their tabulations, many small businesses that file personal income taxes that are above this income threshold. And they believe in the overall conversation of this topic, saying we need to create jobs. We need to remove uncertainty.
GARRETTThe best way to do that is to preserve the current tax structure for these small businesses to allow them to create jobs. That will be their argument. The president will say, look, maybe that's valid. How about $500,000? How about $1 million? So most of these small businesses, but not the super wealthy, can preserve their tax cuts, but we at least get some revenue from those who are clearly outside of that small business bandwidth -- but we would like to tax because I simply philosophically don't believe they deserve another tax cut. That will be where the Republicans will have to figure out if they're going to agree or not.
PAGEAnd it's not cheap. You know, you extend all these tax cuts for 10 years -- $4 trillion. You do it even just for those families with less than $250,000 a year income -- it's $3 trillion. And that's money that would have to be offset by spending cuts elsewhere if you really want to get control of the federal budget.
REHMAll right. Let me ask you now about the House leadership. You've got John Boehner. What about Michelle Bachmann? There's a lot of talk that she's maneuvering for the fourth place...
REHM...in the House, and yet people are not sure they want her.
GARRETTYeah, and she has no chance.
GARRETTI'll just tell you that right now. Michelle Bachmann is a fascination. She's a phenomenon within House Republican rank. She's a cable TV star.
GARRETTBecause she's on cable TV a lot, and she says things that are interesting, at least to the Tea Party activists and the party who are not silent. But House leadership races are not conducted in Tea Party caucuses around the country. House leadership races -- or Democratic leadership races, for that matter -- are carried out entirely within the confines of the cloakroom, and they're based entirely on your personal relationships and your personal commitments to other members. Michelle Bachmann does not have a high profile in that regard. Jeb Hensarling is a Democrat -- is a Republican from Texas who is eyeballing that and is the preferred leadership favorite.
GARRETTAnd let me just break this down very simply. In this last campaign cycle, Michelle Bachmann raised $11.4 million. She spent $8.6 million to raise it. She contributed to precisely 13 House Republicans, most of them in Minnesota. Jeb Hensarling, however, raised much less than that, gave almost a million dollars to the National Republican Congressional campaign Committee and gave lots and lots and lots of individual contributions to individual members, both in the House and running in the cycle. Those kinds of personal bonds are the kinds of things that make leadership races ultimately successful.
PAGEI don't know if I'd call that a personal bond. That's more like a monetary bond.
REHMYeah, exactly. She also apparently...
GARRETTWhen you're a struggling candidate, and you get a check from a member, you're like, hey, I'm personally liking you now.
REHMNow, she said she wants to create a House caucus for the Tea Party. I mean, how are leading Republicans going to react to that, Todd?
PURDUMOh, that's the kind of thing, I think, John Boehner might let happen as a kind of useful steam valve. It's -- you know, they're all -- he said before that there are all kinds of caucuses for all sorts of things. And, having been in leadership, he himself hasn't joined any caucus in years, he said. But, you know, I think Congresswoman Bachmann, for example, last week when she made this ridiculous claim that President Obama was going to be costing the taxpayers $200 million a day on his trip to India, which is more than it cost...
REHMIs she the one who said that?
PURDUMShe repeated something…
PURDUM...that appeared in the Indian press...
PURDUM...but she's the one who gave it traction here in the states.
GARRETTSo did Anderson Cooper on CNN.
PURDUMYeah, and, I mean, it's just so clearly not true that -- it's one of those kinds of things that I think may help her with the people who like her. But it's really quite damaging to professional politicians of both parties. You don't want someone going around talking that way.
PAGEBut somebody will emerge as the lead spokesman for the Tea Party group in the House, and I don't know who it's going to be.
GARRETTAnd it wouldn't surprise me at all if there wasn't a Tea Party representative put in with the larger leadership circle. That's a way to skin this cat. And, believe me, John Boehner knows a thing or two about skinning cats.
REHMTodd, talk about John Boehner and what we can expect to see in terms of style. He was at that House podium screaming, hell, no. Is that the kind of leadership style he's going to use?
PURDUMIt'll be really interesting to watch, Diane, because I don't think that's his preferred leadership style. It's not how he came of age politically. It's not his personal instinct. He's much more of a kind of a dealmaker and a back slapper. He's a very genial person. He's almost impossible not to kind of like at a human level. And I don't think he wants to be -- I think he's, as Major said earlier, quite sensitive to the notion that majorities in this day and age are fragile. And he doesn't want to lose the majority by overreaching. But there will be a lot of people around him who are pressing for, you know, tough action, including Eric Cantor, his majority leader-to-be. So I think it'll be interesting to watch in the coming months just which John Boehner emerges. And I don't think we can be sure yet which one will.
PAGEYou know, I don't think most Americans know one thing about John Boehner.
PAGEI don't think he's -- well, and he's about to become very well known. And he's got such an interesting personal story, which Todd has written about in Vanity Fair. The youngest of 12 children?
PURDUMYes. I asked his older brother how much older he was. He said 362 days older, so...
PAGE...had a small business, a tavern in which he worked. We saw how -- you know, he seems like a madman kind of throwback sometimes, with a gravelly voice and the smoking Camels and the acknowledging what he drinks and that kind of stuff. But we saw this emotional side on election night where he was -- he started to cry. He had trouble moving on. And those close to him told me that he's done this before, that he shows that kind of emotion.
GARRETTThere is something worth noting about the distance traveled here in Washington for John Boehner. John Boehner arrived early in the '90s. Suddenly there was a Republican majority. A lot of good things came to John Boehner very quickly, much quicker than they came to most people in political life, particularly a little House member from Ohio. He was suddenly in the leadership circle. He was a player. And then he began to see the leader, Newt Gingrich, go off the rails, he thought. He became part of a rump group that tried to oust the speaker. That failed. He was ostracized, and Republicans lost power.
GARRETTIn the meantime, he went off to the hinterlands, being a chairman of one of the committees that Republicans thought the least of and were least interested in -- education and pensions. He was rescued, to a degree, by the presidency of George W. Bush and became the legislative driver of No Child Left Behind, a significant piece of legislation, then later pension reform.
GARRETTSo John Boehner was this young whippersnapper elevated to leadership, shunned, ostracized. Then he went to the hard work of legislating in Congress, put together, as a chairman does, bipartisan majorities on big issues and then struggled his way now back to the pinnacle of power. It is that distance traveled and having something, losing it and fighting your way back that was part and parcel of the tears we saw on election night.
PURDUMNo, I think that's true. I mean, he's also come a long way from Ohio. And he's the first person in his family to go to college. I think he's an emotional person. I've seen him tear up over talking about the troops in harm's way or -- but, you know, if you go on YouTube, you can find any number of videos of him tearful on the House floor. So I think, you know, for him, the challenge will be remembering the journey he's taken, as Major said. How much is he willing to -- you know, how much is he willing to risk to go forward?
REHMWhat does that mean?
PURDUMWell, I mean, is he willing to buck his own caucus in the name of getting something done, preserving an effective legacy for himself as a speaker? Or is he willing to just keep saying no in the name of trying to, you know, have the Republicans hold some narrow partisan advantage?
PAGEAnd, you know, there's a balancing act for him between wanting to get things done that Republicans want to do and putting President Obama in the worst possible position he can be in. And one thing that happened after '94 -- between '94 and '96, when, of course, President Clinton won reelection, was that people in the -- the Republicans in Congress decided that Bob Dole was going to lose and that they wanted to have some stuff on their own résumé to talk to voters. And that's when you saw, for instance, the final Welfare Reform Bill passed. It wasn't at the point that Republicans thought they were likely, or had a very good shot, at ousting President Clinton. So there's a balancing act that's going to unfold here, and I don't think we know where they're going to end up on that.
REHMHow is he going to get along with Eric Cantor, Todd Purdum?
PURDUMWell, you know, I think they have a very correct relationship, but, I mean, Eric Cantor's going to be nipping at his heels. You can see kind of in the public body language between the two of them when they unveiled the Pledge to America and the news conference began, Eric Cantor took sort of two steps forward to be right at John Boehner's side as if he were, you know, ready to answer any questions that came his way. And Mr. Boehner didn't direct any questions from the audience his way, and you could tell that Eric Cantor would have been happy to talk. So I think that's one of those things. You know, look at Nancy Pelosi and Steny Hoyer -- there are quite a lot of tension between them, and we're going to see that unfolding in this race if Speaker Pelosi tries to run and become minority leader.
REHMDo you want to talk about Nancy Pelosi for a moment?
PAGEWell, what an interesting decision.
REHMI should say.
PAGEI mean, the speculation in town was all that she would step down, maybe resign from Congress once the Democrats lost 60 or more seats on election night. She decided not to do that. She wants to stay in power. I don't think -- there is no sign she'll be effectively challenged, so I think we should look and expect for her to be the Democratic leader. But that means everyone else has to move down a step or fight each other for the next job, which is what's happening now with Steny Hoyer and Jim Clyburn from South Carolina. One of the interesting things I saw in one of the pieces I read this morning was the age of these Democratic leaders. Nancy Pelosi is 70. Steny Hoyer is 71. Jim Clyburn is 70. You know, I think Democrats could look at that line up and say, where's the fresh faces and new leadership that we might need?
REHMSusan Page of USA Today. You're listening to "The Diane Rehm Show." All right. Let's open the phones, 800-433-8850. Let's go first to Miami, Fla. Good morning, Eddie. You're on the air.
EDDIEHi. How's it going?
REHMGood. Go right ahead, sir.
EDDIEI was actually calling (word?) because I wanted to touch upon an issue where we have these new Tea Party political officials that are saying that they want to cut spending. And I'm already drawing conclusions between now and the past -- I want to talk back to doing the Great Depression. You have, for example, Hoover not wanting to give any direct relief, and we know this history has shown us that cutting back spending, not giving relief to those in need, is only going to aggravate the situation.
GARRETTThere are many economists on the right and the left who believe right now it would not probably be a bad idea to add a little bit of federal fuel to the fire to goose the economy along a little bit on a short-term basis. We're going to see a small demonstration of this rubber meeting the road come Nov. 30, when unemployment insurance benefits expire and have to be carried on. Now, the lame duck Congress can push that forward, but Republicans will have, not 41, but 42 votes in the Senate because Mark Kirk is a special election victor and will be sworn in earlier. So they have 42 votes.
GARRETTThey have more than enough to completely stop that if they want to. And if the new Republican passion on spending is, hey, nothing, not even unemployment insurance benefits -- I'm not predicting that, but it's something to watch in this early clash over how involved, if at all, the federal government is going to be in providing basic fundamental cash for people who can't find a job and are unlikely to find a job in the near term.
PURDUMWell, you know, Eddie makes a very interesting point, which is, in a real way, we're still having the debates of the 1930s. And, in fact, they've been renewed in some sense, in President Obama's presidency, with all this allegation of his being a socialist and so forth and so on. And the economic debates that, in some ways, you might have thought the new deal is settled, are in fact -- you know, 70, 80 years later -- very much with us still. And that's kind of the fight we're having.
REHMTo Cleveland, Ohio. Good morning, Thad. You're on the air.
THADHi, good morning. I just wanted to kind of ask the question of the Republican or anyone on the panel who has the -- represents a Republican view. For those of us who voted for President Obama, he represents, I believe, our opinion. And so the Republican attacks are generally -- I view them as an attack on my opinion on what I would like the president to do for our country. And so I really want to understand what the Republicans are going to do that's so radically different than what the president is trying to do right now. If he was able to actually implement the things that he wants to do, and we could see what that would do for our country, the Republicans must have a fairly specific idea of what their ideas will achieve.
REHMOkay. All right, Thad. Thanks for calling. Just to point out, our guests are reporters and represent neither Democrat nor Republican viewpoints. Susan.
PAGEBut I do think there is a fundamental difference between the vision for the country that President Obama represents and that this new emboldened, resurgent Republican -- Republicans in Congress represent. And that goes to the role of government and the size of government, the scope of government, what government should be doing. Well, and health care reform -- maybe Thad supported the idea that the federal government has a role to guarantee that people have access to health care. Well, I think Republicans, as a party, don't believe that. They believe that government might want to make it easier for Americans to buy health insurance, but they don't see this as the role of the federal government to ensure. And you could go down the line when it goes to the auto bailouts or the bank bailout and the other big things that the president has done, the overhaul of financial institutions. On all of those, Republicans see a different path.
REHMBut do you really see Republicans spending two years trying to overturn health care legislation?
PAGEI do, and I think they will both try to repeal it. And they'll try to starve it of funds to make it harder to implement it.
REHMSusan Page of USA Today, Major Garrett of National Journal, Todd Purdum of Vanity Fair. Short break. Right back.
REHMAnd, now, to a few e-mails. Here's one from Bradley in Pittsboro, N.C. He says, "It seems to me the small business argument for keeping the tax cuts for the wealthy is bogus. Aren't we talking about taxes on the individuals? Wouldn't a business income be taxed as business? If a small business owner is bringing home $250,000 in excess of what he was putting into his company, I don't really see it as bad for the economy if his or her taxes go up 3 percent." Todd Purdum.
PURDUMWell, I think -- correct me if I'm wrong, Major -- but isn't the Republican argument that some of these people are in fact kind of entrepreneurs who are paying personal income taxes as opposed to corporate income taxes?
GARRETTRight. Or Subchapter S taxes.
PURDUMAnd that they are basically sole operators who would be punished because they make a million dollars a year or something like that at -- which they then have to pay their payroll and do all these other stuff?
GARRETTRight, right. And they would invest less in their business. They would hire fewer people. They would buy a less equipment. All these things would create either uncertainty or confiscatory or semi-confiscatory taxes, according to the Republican point of view on this. The polling data, though, does not currently favor the Republicans on this issue. National Journal ran a poll right before the election, and it was 54-38 siding with the president on this income issue.
REHMAnd here is a tweet from an individual who asks -- she says or he says, "I've heard more Republican control in Congress could be good for compromise on Obama's agenda. Is this a possibility?" Susan.
PAGEIt's possible. You know, it's possible that Republicans in the House who have been pretty united in opposition to the Obama agenda on issues like raising the debt ceiling, which is something that's going to come up next spring, maybe in May, will feel obliged to work with the White House to arrange to have that happen. Because you really don't have -- as a country, we don't have the option or not raising the debt ceiling and defaulting on our obligations. So you could see areas in which there is more possibility for compromise because power is shared.
REHMHere is an -- pardon me -- e-mail from Luke who says, "When you do the numbers, most of the budget comes from the military, Social Security, Medicare and Medicaid. How far are Republicans willing to cut these? Are they willing to cut military spending? How far are they willing to cut Social Security and Medicare? And if they do, how will this affect the 2012 elections? It would seem like most of the energy for Tea Party people were from elderly folks on Social Security and Medicare." Todd.
PURDUMWell, I mean, a Republican like Joe Scarborough is willing to cut those things. I'm not sure there are many elected Republicans willing to cut to those things. And the truth is, in the modern era, the Republican Party has become so anti-tax that its argument really collapsed of internal inconsistency. They can't want all the things they want and not ever raise taxes because you just can't make the numbers come out right.
GARRETTI talked to Eric Cantor before the election for a piece that I wrote for National Journal. And he said, look, everything is on the table. And we -- though we exempted defense in veterans in the main from our request to cut discretionary spending by 20 percent, I'm willing to look at defense. I'm willing to look at veterans. And then came the great Republican codicil which is, if it's inefficient, if it's not productive, we'll cut it.
PURDUMWaste, fraud and abuse.
GARRETTYeah, well, all right. What you can assume, until they prove otherwise, that will be an incredibly narrow definition of efficiency or inefficiency. The one area, though, I would say, to worth watching if this Tea Party caucus gets its legs beneath it is something that many Republicans have talked about but have never been willing to confront, which is "corporate welfare," subsidies to large corporations. Now, I'm not predicting that this is going to happen. But it would surprise me if that's a place...
GARRETT...where President Obama and these new Republicans coming, wanting to cut spending and not really enamored of corporate American and the bailout culture and all that, find some potential common ground.
PAGEWell, Luke asked about the willingness to tackle entitlements, for instance. Well, we'll have an early test to that, because this bipartisan commission is supposed to report back on Dec. 1. We don't know yet if this 18-member commission is going to be able to reach an agreement among themselves, but when they put out their report, that will focus everyone's attention on what tough steps you have to do if you really want to address problems with Medicare and Social Security.
REHMJamie Galbraith was on this program last week. He said he predicted there would be no report because there is no consensus on what to do about it.
PURDUMYou need 14 of 18 votes to have a consensus.
REHMThat's right, and no consensus. All right. Let's go to Rockville, Md. Good morning, Neil.
NEILHi. Good morning, Diane. Thank you for taking my call.
NEILI wanted to comment very briefly on the issue of the Bush era tax cuts. First off, I am kind of flabbergasted at the Republican response to make them -- or their stated agenda to make them permanent. As I understood, the Republican agenda, it was to radically cut the deficit, and this seems to be the most elegant and most present method of doing so. And while I realize that they would like to reduce overall government spending in order to raise personal incomes in that manner, it seems to me that they're putting the cart before the horse.
NEILBut what really surprises me is the Democratic response of almost kowtowing to that. You have Mitch McConnell and John Boehner both saying, in their own words, essentially no compromise on most issues in the Senate, in the House, and that if the Democrats want anything to get done, they're pretty much going to have to show the Republican lines. And it seems to me that on this issue, Obama has a very strong case for making Democratic voters happy and for actually restoring a lot of morale to the Democratic ranks after what he called a shellacking.
NEILAnd they don't need a majority in either the Senate or the House. They just basically need to sit on their hands and gridlock any kind of extension of this during the lame duck session, and they will expire on their own. So it seems to me that it's a very good area for more aggressive compromise. And I'm wondering what the commentators have to say about why the Democrats are not being more aggressive on this issue, if not others.
PURDUMWell, I think Neil makes an interesting point. One of the realities, though, for President Obama is a lot of Democrats in both the House and the Senate are basically in favor of extending the tax cuts for everybody because...
PURDUM...the feeling that they don't want to rock the boat in this current economic climate. But what Neil didn't say but implied in his comment, is that we forget that marginal income tax rates are basically -- I think, they're at their -- close to their lowest levels of modern times. And in other eras of our history, in the 1950s, in the 1970s, they were much, much, much higher. In the 1950s, approaching 90 percent. In the 1970s, approaching 70 percent. And we forget that we are basically paying record low rates of income tax while conducting two wars and all the other things that the government is doing. And that's what's caused the problem.
PAGEYou know, I think Neil is wrong though, that Democrats would be happy to see all the tax cuts expire, because that would expire on everybody. And they're -- not only would it expire on middle-class families, low-income families, we'd lose that big doubling of the child tax credit that was part of the Bush era tax cuts. We'd lose the 10 percent bracket for lower-income workers. I mean, there are a lot of consequences. Everybody is in favor of extending tax cuts, the tax cut plan for lower- and middle-income families. Really, the only place there is a partisan divide is when it comes to upper-income families.
GARRETTBut this speaks to what the president is going to have to consider. Does he want to make a definitional fight? And does he want to make it right away? And the Republicans will make that very same calculus. And will middle-class taxpayers find themselves the victims of this definitional fight?
GARRETTNow, I believe Susan is right. In the lame duck, if they can't agree on the long-term extension, they'll extend them until February or March. And then they'll have a fight over what to do and what degree to do it. In the new Congress, remember this -- there will be 23 Democrats, 21 pure Democrats and 22 -- and two independents who caucus with the Democrats up for reelection in 2012. Only 10 Republicans will be up in 2012. And that ratio is something very much in the mind of Republican strategists because they believe many Democrats seeking reelection 2012 will be very sensitive about this issue, and let us say, much more prone to compromise.
REHMWhat kinds of outside pressures are going to be driving the Republican agenda? I understand that there was a meeting last week led by Brent Bozell, who is William Buckley's nephew, that you had Tony Perkins, president of the Family Research Council, Tim Phillips, president of Americans for Prosperity, Regnery, publisher of The American Spectator, all coming together to forge an alliance working against Obama. How is the president going to deal with that, Todd?
PURDUMWell, again, I mean, in some ways it's always useful for the president to have a foil, to have an opposition. His -- part of his problem the past two years has been that he's had the majority in both Houses of Congress -- albeit at a pretty narrow majority in the Senate in some ways -- and so people expected him to be able to control them. And he -- many of his heartaches and headaches have come from his own party, frankly, from the left wing of his party or on certain issues from the conservatives, which are now in fewer number in the House. So I think if the president is adroit and seems reasonable in the face of demands that he can portray as extreme, it could help him. But, you know, there's an awful lot of energy and an awful lot of money and an awful lot of rhetorical bombast that's behind pent-up Republican demands. So it will be interesting to see.
PAGEBut, you know, there's the kind of ideological conservatives, and those are pretty easy to cover. What's going to be harder to cover is pressure that comes from corporate interests that contributed to the Chamber of Commerce, who contributed to American Crossroads, helped elect many of these Republicans -- we don't even know who many of them are because there were no disclosure requirements for some of these groups -- and what they want in return for the money they gave.
REHMAnd to Middleburg, Ohio on that very point. Good morning, Maureen.
MAUREENGood morning. You've all talked about what I have been thinking about. What -- by the way, John Boehner crying does not move me, and I don't feel empathy. I'm so concerned that their sole goal is to unseat President Obama in 2012 by any means necessary -- as I think one of them has even said -- and the machinations that go on behind the scene in order to make this possible, with the marriage of a lot of money that is anonymously donated and supporting candidates who will make that possible and the misinformation that goes out to the public. And this is what drives me absolutely crazy, is if the public is not educated and is moved emotionally on a very primal level or a level of almost elementary understanding, they don't grasp what's going on that is working against them.
GARRETTWell, one thing I would say about Maureen's comment right there at the tail end, about the country being moved by passion or ideas or feeling...
GARRETT..emotion -- many Republican said that very same thing about the 2008 cycle and the President Obama's campaign. Whether fairly or not, after big elections, the losing side often feels that the other side simply wasn't paying attention to the things that needed to be paid attention to -- that's point one.
GARRETTPoint two, picking up on Susan's point about the money and that it came in down the stretch -- very important to remember that the institutional Republican fundraisers, through the National Republican Congressional Campaign Committee, funded many of these House Republicans early, earlier than usual. But they ran out of money down the last two weeks because they wanted to soften up these Democrats and figure out a way if they could win. How did they fill in the blank of the last two weeks? Through these outside organizations. They were anonymously funded or largely anonymously funded. That's a huge thing to remember.
REHMMajor Garrett of National Journal. You're listening to "The Diane Rehm Show." And here's an e-mail from Lisa. "Can one of your guests explain what Republicans are going to do about increasing jobs in this country? I thought that's what they ran on to win gains last week. Instead of talking about that, the first thing Mitch McConnell says is he's going to make Obama a one-term president and get rid of ObamaCare." Todd.
PURDUMWell, it's an interesting question. And I have to say that the Republicans, up to now, they do say rhetorically, you know, we've got to stop President Obama's job-killing policies and beware of the jobs, John Boehner said that all fall long. Six months from now, people will be asking John Boehner, where are the jobs? And I'm not sure they have a cohesive vision for just what they can do about that. And if unemployment is still close to 10 percent next summer, you can be sure that the Republicans will be feeling the pain.
PAGEWell, what they're not going to do is what the administration has tried to do up to now, which is stimulus spending which created some jobs, maybe not as many jobs as they had hoped -- a lot of debate about that. But there's no appetite for doing that among Republicans. The Republican argument is if you cut taxes, if you reduce regulations...
PAGE...if you create more -- if you provide more certainty, then employers, especially small employers, will feel confident enough to stop -- to start hiring again. So I guess we'll have a test to that.
GARRETTAnd if I could, Diane, address the Mitch McConnell statement because he made it to me. It was my piece in which Mitch McConnell said, I want to -- we want to make -- our number goal is to make President Obama one-term president. The back story for that is, the last three or four months, McConnell -- and to a certain degree Boehner -- had been looking at these previous cycles -- Truman in 1946, Eisenhower in 1954, Clinton in 1994 -- where a first-term president lost control of his House and Senate yet to win reelection the very two years later. All three cases, Truman, Eisenhower and Clinton, were thought to be much weaker coming out of that first midterm election than they proved to be just two years later.
GARRETTMitch McConnell said, I don't want to repeat that history. I don't want to win in 2010 and then lose in 2012 because the veto pen and the president's power is the thing that most aggravates those people who are supporting me. Mitch McConnell did not consider this an exceptional comment at all, to say, of course, I want President Obama to be a one-term. I'm a Republican. What -- would you believe -- expect me to be here and say, I want the president to be reelected? I'm leader of the opposition. But, of course, in the context of a new Republican House under new management -- so to speak -- to say that and to say it that aggressively in a way -- we all know Mitch McConnell. He does not typically like to make news in that kind of way. He was laying down a marker. Partially that marker was for the new Tea Partiers coming in, saying, if we don't want to accomplish all the kinds, we do have a bigger goal.
REHMBut was that a mistake to say to the American public? Todd.
PURDUMI mean, I have to agree with Major, that in some ways that's the American way. Although what's interesting is you can hardly imagine Sam Rayburn or Tip O'Neill saying to President Eisenhower or to President Reagan the equivalent of hell no. Now, that's partly the decline in the civility of our political discourse, and it's partly an overt -- it's partly a reflection of deep divides in the American body politic that didn't exist in the 1950s. But -- so that I think is -- it may still fall heavily on the ears of older timers. I definitely think I'm one. It sounds a little harsh, but in some ways, that's what we've come to. We've come to a parliamentary system of elections, almost. That's what almost happened last week is, you know, a parliamentary shift in control.
REHMLast words, Susan.
PAGEYou want a leader to say, I want good things for America. I want jobs. I want peace in the world. Look at elections in two years.
REHMSusan Page of USA Today, Todd Purdum of Vanity Fair, Major Garrett of National Journal. Thank you all so much.
PURDUMThank you, Diane.
REHMAnd thanks for listening. I'm Diane Rehm.
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