Will America Avoid the Fiscal Cliff?
Congressman Michael Burgess (R-TX) talks to Alan about Obamacare, a flat tax and the Fiscal Cliff.
- Duration 14:15
- Date Dec 7, 2012
Congressman Michael Burgess (R-TX) talks to Alan about Obamacare, a flat tax and the Fiscal Cliff.
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This transcript is automatically generated
And Alec come welcome back provided a very nice to -- stop by congressman every time here -- the woman every time whatever you can you're gonna be here during -- -- And -- didn't make it noted that the airlines -- and wouldn't wouldn't fly in here for summary congress and Michael Burgess of Texas you are vice chair of the house energy and commerce committee subcommittee on health.
Nearly named -- -- the health -- rather the energy and commerce subcommittee on oversight and investigations.
-- chairman of the congressional health care cause if you like going on -- for -- It's a busy day yeah you've practiced medicine for nearly three decades before being elected to congress.
In in 2002 just to get this out of the way birth control -- unnecessarily cause cancer right as not an investment again or it.
You must be a little disappointed about the results -- election you really thought Romney was gonna win Chris -- -- -- really crossword you know is that you have these are tough elections.
-- -- we we lost the majority 2006 here I am I'm winning my reelection yeah you 170% right I it was a top Republican vote discriminate percent of yeah.
So it was I don't Kenny thanks you -- no complaints there but it says it's tough to have a big a big -- it and but look at everything else crashing your birdie around what do you think how things going to be different after January when -- recent.
I don't know because you know we're viewed as you know we're up there now and it does it's just not working all that well -- so it is hard to imagine how it's going to be better in January it's.
It seems irreversible be afraid of the fiscal cliff let's get to Grover Norquist of your particular those pledges and that's an idea intellect in 2002 nobody knew me from -- -- get out of -- -- congress.
I -- six people a -- doctor nobody nobody associate me with any politically.
But it -- to know where I was on that issue.
You know the thing is and Rula pointed out people is.
I was reelected with almost 70% of the vote in Newton county.
I didn't run on -- platform.
I'm raising taxes on the top 2% the bottom two percents are little to -- take a pledge to never ever do it and underneath circular I did not run a platform of raising taxes that's not what I came to Washington do this time -- didn't come to grow government that came to control.
You know it's almost irrespective of the -- -- a flat tax -- talking as if I -- get your latest plan that this would do you know if anything -- if we could get a flat tax and return more revenue and he'll be OK with that -- the bottom line right now as we need to get people back to work when we get in.
Number of Republicans -- people in your caucus or now.
When -- on this whole issue of taxes right it looks like there.
The word revenue enhancement is an ice -- term right it looks like some of them ready to do some analysts see what happens on an added at that I don't believe that it's going to attempt.
I was running the elections in full and when they say they willing to increase revenue what do they mean how they do it and he hit it close loopholes you gonna have to hurt the middle class sergeant and a necessary.
-- -- mean if you if you put a cap on deductions.
Of the governor Romney talked about during the campaign.
And there's certainly you know he he he he you decide what the numbers are if you decide what to what the principles are you're gonna work on now look.
Let's be honest if it's what President Obama -- proposing right now the top 2%.
The murder raise the rates back to.
It what he calls a Clinton error rates if that would really fix the problem -- maybe we can have a discussion but you're gonna you're gonna produce eighty billion dollars.
In revenue that you're not producing today now the fiscal year started October 1.
You -- paid for about to Columbus Day but that it.
It -- isn't that isn't the idea that you have to do more than just one thing and that's certainly gonna help we've always had a progressive tax system in this country and the rates under Clinton enabled us partly.
To have a very robust economy.
-- here's a dirty little secret about that.
The rates are already going up already going up not be done with the expiration of the tax policy but because of the Affordable Care Act -- -- unaffordable care as I'd like to -- -- a volunteer it raises taxes and a big way.
And if you combine that with the expiration of the bush tax cuts.
You know why you see all these companies advancing their dividends now for the next two quarters they're they're paying them in December.
Because it's a 44%.
In that tax on dividends that starts on January 1.
It's a three times a threefold increase in dividend tax.
For the first time dividends and capital gains are going to have a payroll tax assessment placed on the under obamacare and this is a big deal with people don't realize is already happening.
If you were just racing those little marginal rates on the on the upper income murders if that was gonna fix the problem.
Okay problem solved we did -- obamacare -- -- before but it.
And Obama all right so why I've not heard -- big stink about this.
What you're saying about obamacare I've not -- Republicans.
-- this is part of a negotiated country is a mess of ties they're being dialed by the president who loves them so much that he would never do anything to damage them and he's fixing to crash the economy at Griffin gives us if it's obamacare is gonna crash -- really -- -- -- -- say this I haven't heard the McLaughlin McDonald's a whole different double acts there but.
I have -- -- Republicans say what you just said why didn't she watch our joint economic committee hearing today and you would have become enlightened when I definitely up -- that is that.
But I written and gotten a lot of attention what you're saying in the rental level to which you -- obamacare -- that raises taxes.
Well yes I mean Fox News out of a -- blog about it in July amendment.
-- the medical device taxes going up to 2.3 percent on January 1 and I learned something from obamacare and I'll give credit where credit is due.
I always thought walk in medical terms -- and maggots were about equivalent but I found out because of this new tax policy.
Leeches are regarded as a drug.
Mandatory device so it -- -- will be taxed leeches will still be reasonable price so once people start getting a load of this after the first of the year you believe.
That we will be in.
Trouble and that people will maybe reconsider whether they want to raise taxes on the wealthy bullet if you don't believe that tax policies -- behavior why why -- -- companies advancing their dividends.
They're they're projecting it for the next two quarters and painted in December.
I mean why are they doing net after what people see this coming it's not just me do you think will be a deal the fiscal -- You know I don't know the answer to -- and I don't think it's sort of -- it was not financial Armageddon if there's not.
If not financial and now a medium and the taxes go up and all on all people all Americans if we don't get a fiscal -- is a House of Representatives sets all tax policy so that we will be back at work on January 3.
And tax policy to be revisited on that day I -- -- In nothing in less something is done there is a fiscal cliff over which we fall right and -- taxes -- -- go back the Clinton tax rates on everybody.
India and you know the president really honest about his discussion of the Clinton tax rates and that's really what would be required.
If if you were going to raise the kind of revenue necessary to move the needle.
And he's not going to move the needle.
The other thing though that happens on January 2 what a lot of people are concerned about.
Our -- the -- cuts the automatic cuts in the sequester.
But you know there's a lot of people back home and say.
You're never gonna get any cuts any if you don't do something like that that's the whole.
Idea of having a very painful Graham -- who's gonna suffer the most.
Under these -- it's going to be the for Medicare Medicaid recipients people who need -- the most of the defense contractors whom those -- a farewell -- Bolivia.
There's going to be a 70%.
Across the -- of defense spending as there will be at the Department of Health and Human Services so NIH takes an 8% -- FDA takes an 8% yet.
You know -- that you know it's across the board they don't think any of this is directly affect the cliff is -- if we go to get over the cliff do you think it's a -- well I think they're doing plenty of opportunity come back them and and and do whatever policy you decide to do just because the month of December runs.
What matters when -- month of December runs out.
Is you've already got it baked in the cake.
That your different -- are going to have a payroll tax it's never been there before plus the payroll tax was increased for people who earn over 250000 dollars -- That was increased by almost a full percentage point this is the president want to keep the payroll tax.
Holiday going and Republicans don't they want -- -- that that.
You don't really hasn't been -- much discussion and -- the White House yet -- that was the big fight this time last year but you know honestly -- I think the president Democrats wanna keep that payroll tax cut don't it's like they just discovered that that was a talking point that they'd overlooked I don't think they're serious about and I honestly don't there's anybody serious.
Yeah and -- -- series is our lead by Ramirez I'm not -- beside -- as Boehner serious.
-- you know ended.
You know this is the the tough part of -- and Election Day happened today and what we were about a week past Election -- The president the speaker hadn't spoken since the early part of this summer when this -- mean they just had a phone conversation yesterday.
They even try to play good yeah that's good they do need to top -- they like each other.
You don't have the -- -- that Maceda.
That where you read probably Bob Woodward's book on one out of I've read enough about the the they some of the medium Rose Garden where -- -- a Winston cigarettes and electorate -- yeah -- guys -- bigger reverses the the cigarette itself.
I don't these inactive guys you think of a lot in common but -- that bidders a dealmaker is that the fact that the Tea Party Republicans -- far right.
Kept them make a deal the last time now he wanted to make a deal they would low -- kept him from make a deal last I was president gaming and it upped the ante at the last minute.
And and and speaker thought he had done all -- he possibly to do.
And that's indicated to him that the president wasn't serious you know you don't like this president much.
And I'm not that I personally but I mean you just don't know him I mean he's been president for four years I've been in congress during that time and even of the White House right I went to the White House.
That was one of the few Republicans who went to Haiti after the earthquake didn't saw the devastation of the damage there I was invited the White House.
When the president of Haiti Damon -- to the members of congress who -- the Arctic -- Republican there that day but really I didn't talk to anybody the administration Bo the dog came out and and we know we shook hands -- Well that's organized that's in the you know.
We -- at 8774.
-- -- he then eight and -- one and the audience feels about this fiscal cliff stuff representative Michael Burgess is with us.
He is joining us now they -- have every -- in person our numbers 8774.
-- reach 7736725.
So you you don't have any sense whether this is going to be solved there not united you don't have a sense of whether we go over the -- there's just no feeling right now about what this week.
It will be solved I'm not sure what that solution will look like room but obviously if it's not I'd I don't feel that it's the you know we were cold before the debt limit.
The deadline came and went in in August on eleven I'm in the bond vigilantes where we're circling the capital and they were gonna destroy the economy.
And -- downgraded us anyway in the -- of the world didn't happen so you don't ask you threaten me with a into the world before and end it was only so many times you can do that.
You on December 4 to -- that they put a letter on the flat tax to President Obama.
-- your -- rebuilding the dear Mr.
President Republicans and Democrats in congress have raised -- needs reforming our broken tax system fundamental tax reform.
Makes filing easier for American taxpayer -- -- individual tax rates.
And you said -- may I offer my assistance and seeing the such reformers achieved in every congress the last decade and images the freedom flat tax act.
The -- of this is to give taxpayers the option of having a flat tax rate.
Applied to income how would this work exactly.
Well for a -- optional flat tax and of course a flat tax been talked about for a long time my my predecessor introduced a flat tax wouldn't when he was in congress.
The idea behind champion and an optional.
Election to go into a flat tax of -- of construct of their lives are on the tax to big they behave the way we have told them to be okay.
Now you know honestly in him in Fort Worth, Texas the home mortgage deduction is sometimes.
It's not really an enormous amount of money Santa Barbara California summoned by as a starter castle it's a big deal and they've done that they've made that decision based upon the tax code.
One of the things I remember about 86 and and I liked it when -- and -- simplify the tax code but.
It was pretty tough on taxes we -- a lost a lot of our real estate value week because people were wound up.
In tax shelters that -- suddenly no longer necessary so people unloaded those assets energy prices collapsed about the same time and savings -- all failed and that we were pretty tough shape.
So -- remembers that that you could make a sudden adjustment of the tax code.
And you can be pretty disruptive in people's lives when I'd like to do is give people the option.
A saying look up sick of the code.
I'd like to pay a flat rate we can argue with the numbers should be if we can argue you know personal exemptions but no other deductions.
And all of that is is open for discussion but the concept of a single rate tax.
And having people allowing people to elect entry into that tax no you can't.
Go in and out of the tax flat tax and back to the tax code -- -- make that election.
-- -- things are set and I believe me I would pay more tax under flat tax like that's proposed.
But I'd give up that she bustle receipts and -- quality time with the accountant.
And I've been affected veterans I don't know when I signed that thing if it's really bright and -- can -- -- revenues and be giving people the option.
You don't know what you're gonna -- -- how can the government assess.
How successful that'll be in terms of taking care of our debt held it held its for the Affordable Care Act under the congressional but just as guest.
In which have a organized you think the flats and I suspect if it's optional would do anything toward solving our problems you don't have to people -- -- you agree to it you know the numbers and.
You don't and and but but here's the deal Alan -- We know we need to reform the tax code we we know it is it's in desperate need of reform.
-- to trust people to make the right decision yet it might make it might make the numbers a little harder to adjust and I even allow for that.
In the in the billed as introduced us.
Puts -- at a higher rate initially yeah and then brings it down.
Trying to end up -- that historical seventeen to 18% of GDP that we've that that that we had in the past.