Guests: Alex Wagner, Ezra Klein, Andrew Romano, Howard Fischer
LAWRENCE O‘DONNELL, HOST: With congressional Republicans back in their home districts and states, who‘s left to spread lies in the media about the president? All right. Donald Trump.
(BEGIN VIDEOTAPE)
(MUSIC)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I wish I could tell you that there was some easy, simple solution to this.
O‘DONNELL (voice-over): With his re-election campaign officially under way, President Obama takes his budget plan to the American people.
OBAMA: The plan for shared prosperity.
SAVANNAH GUTHRIE, NBC NEWS: Three town halls in three days.
OBAMA: I admit that my plate has been full, as well.
O‘DONNELL: The White House strategy? Fight Republican lies about the debt, deficits, and the economy with facts.
UNIDENTIFIED FEMALE: Deficit reduction has got to be fact based.
UNIDENTIFIED MALE: Saying there‘s no such thing as a free lunch.
UNIDENTIFIED FEMALE: A new poll shows 57 percent disapprove of how he‘s handling the economy.
OBAMA: We must always make sure that we are keeping things in perspective.
UNIDENTIFIED FEMALE: Debate over raising the debt ceiling is already taking a toll.
O‘DONNELL: And the lies continue as Donald Trump is talking to anyone who will listen.
UNIDENTIFIED FEMALE: He‘s on every show, every week.
MIKA BRZEZINSKI, MSNBC ANCHOR: He is rolling the media and he‘s laughing all the way to the bank.
OBAMA: If you say something mean about somebody, that will get you on
TV.
GUTHRIE: When I sat down with Donald Trump, there was one line that came up over and over again.
DONALD TRUMP, CEO, TRUMP ORGANIZATION: Excuse me, Savannah. That‘s another—excuse me. If he wasn‘t born—excuse me.
ANDREA MITCHELL, NBC NEWS: Has Donald Trump done his homework? Is he ready to be taken seriously?
TRUMP: I think I‘m presidential.
O‘DONNELL: Trump pretends to know something about the economy, then says this.
TRUMP: I would not raise the debt ceiling.
GUTHRIE: Businesses have warned there could be dire consequences.
TRUMP: I don‘t care.
GUTHRIE: You can‘t tell China not to manipulate its currency.
TRUMP: If you have the right messenger, they won‘t be doing it for long.
MITCHELL: We should just send the Donald to Beijing and he‘ll take care of it.
UNIDENTIFIED MALE: If he‘s elected president, he‘s going to turn the White House into a casino. Place your bets. Here goes the national debt. Your call. Here you go.
TRUMP: Excuse me. I would love him to come out with a birth certificate.
UNIDENTIFIED FEMALE: The birth issue is going to hurt him.
TRUMP: Excuse me.
UNIDENTIFIED MALE: He wants to see Obama‘s birth certificate. I want to see his hairline. Somewhere back here. That‘s more than a comb over. That‘s a reentry vehicle.
(END VIDEOTAPE)
O‘DONNELL: Good evening from New York.
President Obama went to Northern Virginia Community College in Annandale, Virginia, today, to talk act values—specifically what we value in our government and what we are willing to pay for it.
House Speaker John Boehner announced today that he has appointed Majority Leader Eric Cantor to represent House Republicans at the White House meeting on deficit reduction in May. Eric Cantor, who doesn‘t sit on any relevant budget committees or the ways and means committee and doesn‘t do anything in the way of policy, only press conferences—that‘s who they‘re sending.
But today, with Congress in recess and House Republicans far from Washington microphones, President Obama took control of the deficit conversation starting with the proposal House Republicans oppose most vehemently.
(BEGIN VIDEO CLIP)
OBAMA: We can‘t just tell the wealthiest among us, you don‘t have to do a thing, you just sit there and relax, and everybody else, we‘re going to solve this problem—especially when we know that the only way to pay for these tax cuts for the wealthiest Americans is by asking seniors to pay thousands of dollars more for their health care, or cutting children out of Head Start, or doing away with health insurance for millions of Americans on Medicaid, seniors in nursing homes or poor children, or middle-class family who is may have a disabled child, an autistic child.
This is not a tradeoff that I‘m willing to make. It‘s not a tradeoff that I think most Americans think is fair.
(END VIDEO CLIP)
O‘DONNELL: President Obama has already said he will never sign another renewal of the Bush tax cut for the top tax bracket. But the House Republican budget bill written by Budget Chairman Paul Ryan doesn‘t just want to keep the Bush tax rate for the top earners, it lowers the top bracket from 35 percent to 25 percent.
The president also went after the reforms the Ryan Republican bill would make to Medicare.
(BEGIN VIDEO CLIP)
OBAMA: Medicare is one of the most important pillars of our social safety net. The House Republicans just passed a proposal, and their main plan to reduce our long-term deficits and debt is to turn Medicare into a voucher program.
It‘s estimated by the Congressional Budget Office, which is an independent, bipartisan sort of referee in Congress that determines these things, they figure that seniors would end up paying twice as much for their health care as they are currently, at least twice as much. And more importantly, it would get worse over time because health care inflation goes up a lot faster than regular inflation. So, your health care costs keep on going up and up and up, the voucher doesn‘t.
(END VIDEO CLIP)
O‘DONNELL: Under the Ryan Republican bill, eligible Americans would stop enrolling in Medicare starting in 2022 and instead receive vouchers intended to only partially pay for insurance coverage that is not currently available to people over 65.
The president also talked about the insolvency of Social Security and long-term financing of it.
(BEGIN VIDEO CLIP)
OBAMA: If we don‘t do anything on Social Security, if we don‘t just -
if we don‘t touch it at all, then what would happen is by the time you retire or maybe just a couple of years after you retire, you might find that instead of getting every dollar that you were counting on, you‘re only getting 75 cents out of that dollar, because what‘s happening is the population is getting older, there are more retirees per worker, and more money starts going out than is coming in.
(END VIDEO CLIP)
O‘DONNELL: The Ryan Republican bill would partially privatize Social Security. Future retirees would receive a combination of reduced federal benefits and income from a personal savings account carved out of their Social Security account. The president wants to lift the income cap on Social Security taxes, which is now around $107,000 a year.
And in his speech today, the president may have unwittingly stumbled upon the reason Republicans really want to cut education spending.
(BEGIN VIDEO CLIP)
OBAMA: How many of you who are in the audience have got a Pell grant to help you pay your way? How many of you can‘t afford to pay another thousand dollars to go to school? I know what this is like. Scholarships help make it possible for me and for Michelle to go to college. It‘s fair to say I wouldn‘t be president if it hadn‘t been for somebody helping me be able to afford college.
(END VIDEO CLIP)
O‘DONNELL: Joining me now is “The Huffington Post‘s” Alex Wagner, who‘s also an MSNBC analyst. Thanks for joining me tonight, Alex.
ALEX WAGNER, HUFFINGTON POST: Thanks for having me, Lawrence.
O‘DONNELL: Alex, I‘m not sure the president is going to convince Republicans to preserve Pell grants by telling them that that‘s the kind of thing that got him through college and without that sort of support, he would not be president today.
WAGNER: Right. Yes. Pell grants breed Obamas. Yes, it‘s not exactly a convincing argument for those on the other side of the coin.
But I don‘t think that President Obama is necessarily speaking to Republicans. I think, you know, this is part of his whole new campaign about shared responsibility in terms of fiscal—the fiscal package he‘s presented to the American public.
Today, we saw him in northern Virginia talking about education at a community college. We‘re going to see him at Facebook HQ later in the week where he‘s going to presumably talk about innovation. And then he‘s going to Nevada, also a battleground state in 2012, to again talk about clean energy.
And again—so, this is—this is the second half. He understands there‘s a deficit question in the air that Republicans have been attacking with some gusto. But he‘s also simultaneously trying to put forward his idea for the future, the win the future idea, which is definitely appealing to a progressive left base.
O‘DONNELL: Alex, it wasn‘t billed as a campaign appearance, but it did occur after he‘s already announced his re-election campaign, it occurred in a battleground state, in the area of that state that is most friendly to him in northern Virginia.
He made the argument about taxation, linking it to the Medicare cuts, saying that Republicans want to say to the top taxpayers, that‘s OK, relax, sit back, you don‘t have to do anything. We will take all the money we need out of Medicare in order to try to balance the budget.
The polling that they have on this seems very, very favorable to President Obama‘s position. A Marist poll coming out today saying 64 percent support a tax increase on income over $250,000.
Is this where the president is going to have to keep the focus going forward?
WAGNER: Yes. I mean, I think—I mean, he was saying a lot about the wealthy and, you know, in parts of that speech he said, look, the Republicans and special interests and lobbyists are trying to balance this budget on the backs of the working class. I mean, there‘s a very strong middle working class theme to what he‘s been saying lately.
But I think you also—if you‘re looking at those poll numbers—you have to look at his approval ratings, which among independents are not great. I mean, we‘re seeing historic lows. He has a 47 percent approval rating, one of the lowest he‘s had since he‘s been in office. You know, independents are not giving him great scores -- 55 percent are disapproving of the job he‘s doing.
And a lot of Americans are feeling pain at the pump and the unemployment rate is still high. So, I think he needs to get—he needs to sort of throw them a bone, if you will, and really draw some sharp contrast between his vision for the future and the Republicans‘ vision for the future.
O‘DONNELL: And his policies have a much higher approval rating than the president has. On the Medicare policy that he‘s advocating, he has 80 percent support, including 70 percent support from Tea Partiers, who presumably don‘t even quite realize that they are supporting the president‘s position in these polling questions.
WAGNER: Absolutely. But this is part of the whole—I mean, this is one of the reasons the president likes leading the bubble, as he calls Washington, D.C. I mean, I think—we saw this with the health care debate. There were a huge number of American who is didn‘t understand what was happening in terms of health care reform.
And again, I mean, I think there are people that—the Republicans have been touting deficit, deficit, deficit, the bottom line. And when it comes to real reform of entitlement programs, there‘s a lot of fear out there. And the president, I think, needs to explain to the American people what the Republican package is specifically, and again how he is going to try and preserve these programs in the long term and reform them in a way that is theoretically more sensible.
O‘DONNELL: Alex Wagner of “The Huffington Post”—thanks for your time tonight, Alex.
WAGNER: Thanks, Lawrence.
O‘DONNELL: Joining me now is Ezra Klein, columnist for “The Washington Post” and MSNBC analyst.
Ezra, thanks for joining me.
EZRA KLEIN, THE WASHINGTON POST: Good evening, Lawrence.
O‘DONNELL: Ezra, what do you make of this gap between the president‘s approval rating and then the approval rating in the polls for his specific policy positions?
KLEIN: People don‘t pay an enormous amount of attention to policy. It‘s almost that simple as that. When you say to people do you know the details of the president‘s budget plan and Paul Ryan‘s budget plan, they don‘t come back at you if they are normal human beings, instead of, say, you and me, with, well, Governor Ryan wants to voucherize Medicare and privatize it and the way he sees going is blah, blah, blah.
They really don‘t understand why Washington isn‘t working. They hear the debt ceiling might fall apart. They hear that there‘s an enormous amount of debt behind us. And they get angry that the president isn‘t making it work. That is how they look at Washington.
O‘DONNELL: Ezra, I want you to listen to what Michele Bachmann, the leader of the Tea Party, had to say about raising the debt ceiling yesterday.
(BEGIN VIDEO CLIP)
REP. MICHELE BACHMANN ®, MINNESOTA: What‘s your opinion? Should we raise the debt ceiling?
CROWD: No!
BACHMANN: I‘m with you! I am with the people. I say no to the debt ceiling. No to raising our debt ceiling.
(CHEERS)
BACHMANN: Now, some people will tell you, but, Michele, you don‘t want the government to shut down. The government won‘t shut down.
This is what will happen—revenue will continue to come into the United States Treasury, and we will first pay off our debts, our obligation, and interest on the debt. That‘s the fist thing we‘ll do so we don‘t violate our credit rating. After that, we prioritize our spending because we don‘t have enough money for everything we want.
(END VIDEO CLIP)
O‘DONNELL: Ezra, that is also the Donald Trump position on the debt ceiling. What does Michele Bachmann and Donald Trump not understand about this?
KLEIN: That is a lit match next to a big barrel of kerosene. The debt ceiling is not about the government shutting down. The debt ceiling is about the market losing confidence in the government‘s capacity to pay our debts going forward.
When people talk about what makes America exceptional, it makes economically exceptional, is we‘re the safest investment in the world.
When the financial crisis hit, all the money in the world—not all of it
but most of the investor money came into the U.S., went into treasury bonds. It‘s how we‘re able to borrow at a very low rate and essentially ease the recession, how we‘re able to do the stimulus at a cut rate.
If we lose that capacity, if the market loses confidence in us going forward, we will never get that back. We will become more like a Greece. We will become more like a Britain. We will become more like a country that the market can begin to short.
That is enormously dangerous. And it‘s simply something you never allow to happen if you‘re an American.
O‘DONNELL: And if we do arrange the revenue flow into the Treasury to go directly to debt first, debt payments first, you would obviously have to cut dramatically and instantaneously from other programs, including the big ones, the big cash flows, like Social Security.
KLEIN: But it‘s absurd. So, yes, you could --
(CROSSTALK)
O‘DONNELL: I mean, it‘s not an unimaginable scenario in many ways.
KLEIN: But this is what the market will look. I mean, I just did a big piece on this, and Bill Gross, head of PIMCO, the biggest bond company in the country, said this is absurd. If you do that, what the market will see is that we cannot get our act together in Washington quick enough to avert horrifying consequences, consequences that no one can bear and that frankly no one know where is they‘ll end. It could be a financial crisis as bad or worse than the one we saw in 2007 and 2008.
So, if we tell the market that we are so dysfunctional here that we can‘t get out from under something like that, they‘re not going to take any comfort in the fact we‘ve cut off Social Security checks. If we can do that to American senior, of course, we can inflate our way out of debts. It would terrify them. And if it terrifies them, it would destroy our credit.
O‘DONNELL: Ezra Klein of MSNBC and “The Huffington Post”—thanks for joining us tonight, Ezra.
KLEIN: Thank you.
O‘DONNELL: Donald Trump tried to spread his lies on the morning shows today but ran into a couple of journalists who are used to asking presidential candidates and presidents tough questions. We‘ll show you Trump getting cornered, coming up.
Meanwhile, other Republicans, some of whom are actually going to run for president, are getting caught up in their own records when it comes to raising taxes. Andrew Romano of “The Daily Beast” is here to show us what Mitt Romney, Tim Pawlenty, Haley Barbour and others have lurking in their political past.
(COMMERCIAL BREAK)
O‘DONNELL: The fake presidential campaign of Donald Trump will end by May 16th when NBC announces that he will continue his current occupation as a performer in our entertainment division. But, today, he took his fake campaign to the morning shows where NBC‘s Savannah Guthrie and ABC‘s George Stephanopoulos showed him how badly he would be humiliated in a real campaign.
And later, Arizona‘s conservative governor, Jan Brewer, one of the driving forces behind the nation‘s harshest immigration law, vetoes back-to-back bills that the right wing would love the see become law. What‘s up with that?
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
GARY BUSEY, ACTOR: Donald Trump has the wherewithal, the knowledge, and the awareness of this country. He wants to turn it back to where the founders had it. I created a Buseyism for his last name. T-R-U-M-P stands for “taking redirection understanding massive power.”
(END VIDEO CLIP)
O‘DONNELL: If you‘ve seen the “Buddy Holly” story you know Gary Busey was once a truly gifted actor, though now he is apparently one of the many uninformed voters who would actually vote for Donald Trump for president if Trump‘s fake campaign ever became real, which it won‘t.
Trump submitted to a few more questions today on the morning shows. Some of the questions were unusually simple for a politician but obviously stumped Trump.
(BEGIN VIDEO CLIP)
GUTHRIE: Is there a right to privacy in the Constitution?
TRUMP: I guess there is. I guess there is.
GUTHRIE: So --
TRUMP: Why, just out of curiosity, do you ask that question?
GUTHRIE: Well, I‘m just wondering how that squares with your pro-life views.
TRUMP: Well, it‘s a pretty strange way of getting to pro-life. I mean, it‘s a very unique way of asking about pro-life. Why are you—what does that have do with privacy? How are you equating pro-life with privacy?
GUTHRIE: Well, you know about the Roe v. Wade decision.
TRUMP: Yes, sure. Look, I am pro-life. I‘ve said it. I‘m very strong there. And I‘m strong in pro-life.
(END VIDEO CLIP)
O‘DONNELL: Couldn‘t possibly have given a dumber answer to that question. Trump very clearly has absolutely no idea that the Supreme Court‘s decision in Roe vs. Wade, which made abortion legal in this country, turned entirely, entirely on the right to privacy.
That is but a taste of the humiliation that would be visited upon Trump on a Republican primary debate stage which is, but one of the reasons why he will never run for president.
On ABC, George Stephanopoulos smartly challenged Trump on his claim that he could lower gasoline prices by talking tough to oil-producing nations.
(BEGIN VIDEO CLIP)
GEORGE STEPHANOPOULOS, ABC NEWS: So finish this sentence. If you don‘t produce more oil—
TRUMP: Look, I‘m going to look them in the eye and say, fellas, you‘ve had your fun, your fun is over.
STEPHANOPOULOS: Why? How?
TRUMP: We protect Saudi Arabia. We have soldiers over there that they don‘t pay us for, by the way. We have soldiers all over the Middle East protecting these countries.
(END VIDEO CLIP)
O‘DONNELL: This very, very, very silly man who makes his living performing on an NBC show obviously has no idea, no idea that the country we rely on most for imported oil, the number one source of imported oil to the United States of America is a place called Canada.
His confident ignorance of the world oil market could not be more comic. Every real American business executive knows that Trump is the court jester of American business, not to be taken seriously on anything. And now he is repeatedly exposing his ignorance to the rest of us.
George Stephanopoulos showed all future Trump interviewers how to talk to an out-of-control liar.
(BEGIN VIDEO CLIP)
FOR SUBSCRIBERSCBP leaders cut out of Trump ad buy decision
FOR SUBSCRIBERSA harrowing ordeal aboard an Israel-bound plane
FOR SUBSCRIBERSCBP leaders cut out of Trump ad buy decision
FOR SUBSCRIBERSA harrowing ordeal aboard an Israel-bound plane
STEPHANOPOULOS: Recognize by --
TRUMP: I know exactly what you‘re getting at. For some reason—
STEPHANOPOULOS: The facts.
TRUMP: No, they‘re not the facts. He doesn‘t have a birth certificate or he hasn‘t provided it. He‘s given a certificate of live birth. It‘s a much different—
STEPHANOPOULOS: The certificate of live birth meets the standard on the State of Department of any one citizen.
TRUMP: George.
STEPHANOPOULOS: There are contemporaneous reports in two Hawaiian newspapers given—
TRUMP: George, they co-opted you.
STEPHANOPOULOS: No, are the facts.
TRUMP: George, they‘ve co-opted you.
STEPHANOPOULOS: Who‘s they?
TRUMP: Obviously, Obama and his minions.
(END VIDEO CLIP)
O‘DONNELL: So, Trump‘s response to being pushed into a corner about his lying about the president‘s birth certificate is that George Stephanopoulos is an unprofessional journalist, that George has been co-opted. That‘s the best he can do. That‘s all he‘s got.
George Stephanopoulos recites the facts to the liar and the liar accuses the questioner of being co-opted. The liar doesn‘t counter with any evidence, because the liar doesn‘t know what evidence is. The liar has absolutely no evidence.
Remember the investigators Trump said he sent to Hawaii to investigate the president‘s birth? I told you from the moment he said it that he was lying about that, that he has not sent any investigators anywhere to investigate the president‘s birth.
I get the feeling George Stephanopoulos shares my thinking about that one.
(BEGIN VIDEO CLIP)
STEPHANOPOULOS: You sent investigators to Hawaii and you said, quote, “They cannot believe what they‘re finding.” What have they found?
TRUMP: We‘ll see what happens, George—
STEPHANOPOULOS: What have they found?
TRUMP: That‘s none of your business right now. We‘re going to see what happens.
STEPHANOPOULOS: Have they found anything?
TRUMP: We‘re going to see what happens.
STEPHANOPOULOS: What have they done?
TRUMP: We are going to se what happens.
STEPHANOPOLOUS: When?
TRUMP: George, next question.
(END VIDEO CLIP)
O‘DONNELL: You absolutely could not ask for a cleaner exposure of the liar than that exchange. Trump is asked, what have his investigators found. He says none of your business.
If they had found something, do you think that would be the answer? If they actually existed, if there were any investigators, do you think that would be the answer?
Trump gives up and asks for the next question because he has no answer and because he knows he‘s lying about the investigators, that the investigators don‘t even exist, he‘s never hired any. And he knows George Stephanopoulos knows he‘s lying about the investigators.
The liar will never produce any report by any investigators. He will never name those investigators. He will never in any way prove that he spoke to or hired an investigator to go to Hawaii to investigate the president‘s birth or to go anywhere else to do that.
And yet other interviewers have let him tell that lie with impunity. That lie should be hacked away at by every interviewer who gets a chance with Trump. Now, here‘s George Stephanopoulos guiding the fake politician into a discussion of politics.
(BEGIN VIDEO CLIP)
STEPHANOPOULOS: In your book, “The America We Deserve,” you wrote, “I‘m a conservative on most issues but a liberal on this one.” You were talking about health care.
TRUMP: I want people to be taken care of but not with Obamacare. Obamacare is a total disaster. Also, we‘re in a much different time. We used to think 12, 14 years ago—we used to think we had a wealthy nation. We could take care of people.
The fact is we‘re in a much different time now. The world has changed a lot.
STEPHANOPOULOS: So, you no longer support universal health care.
TRUMP: I support health care for people. I want people well taken care of. But I also want health care that we can afford as a country.
STEPHANOPOULOS: In that same book, you called for a net worth tax, 14.25 percent on people with $10 million or more. Do you still support that tax?
TRUMP: At that time it would have paid off the deficit. I mean, you wouldn‘t have a deficit at that time. Unfortunately, the world is changed. Today, you can‘t do it. Today—and I‘m strongly against tax increases and the reason—
STEPHANOPOULOS: So, you‘re no longer for that tax?
TRUMP: No, no, I‘m no longer for that tax. No.
STEPHANOPOULOS: At that time, you were also pro-choice. Now, you say you‘re against abortion. When did you change your mind on that?
TRUMP: I would say, you know, a while ago, quite a while ago.
(END VIDEO CLIP)
O‘DONNELL: Yes, sure, those flip-flops would destroy a real politician running for office, but Trump will never run so they can never hurt him.
And is it really a flip-flop if he didn‘t understand what he was saying the first time he said it or the second time he spoke on the same subject and contradicted himself? Can you actually flip-flop if you actually never know what you‘re talking about?
And then, of course, there‘s Trump‘s history with bankruptcy.
(BEGIN VIDEO CLIP)
STEPHANOPOULOS: How would you defend any fiscal policy considering you‘ve had to declare bankruptcy numerous times?
TRUMP: I never went bankrupt.
STEPHANOPOULOS: Declared bankrupt.
TRUMP: Excuse me. I never went bankrupt. We used the laws of this country, the bankruptcy laws, because we‘ll buy a company, we‘ll have the company, we‘ll throw it into a chapter, we‘ll negotiate with the banks, we‘ll make a fantastic deal.
(END VIDEO CLIP)
O‘DONNELL: What the guy who pretends he wants to be president just said is, we‘ll buy a company, then we will refuse to pay our debts, and then in bankruptcy proceedings, we‘ll make what he thinks is a fantastic deal, to pay a tiny portion of the debts.
This is the person so many Republican primary voters are now willing to consider voting for. An actual vote for Trump for president will be a failure of an intelligence test, which no one will ever be given because Trump will never run. His fake campaign will be over by May 16th, when NBC announces it‘s upcoming season, which will include Donald Trump as a paid performer for NBC.
He is now NBC‘s Charlie Sheen—the greatest individual embarrassment in the history of the network. And he will continue his venomous, poisonous, hateful attacks on the president and his ugly fanning of the flames of hatred for this president that exists among the people who do not believe Barack Obama‘s presidency is legitimate. And he will do that until May 16th when NBC reminds you how this silly man really makes his living and then orders him to shut up.
Coming up: promising one thing and doing another on taxes may have cost the fist President Bush his re-election—a lesson current Republican candidates have reason to fear. Guess how many of the Republican governors running for president have actually raised taxes?
(COMMERCIAL BREAK)
O‘DONNELL: In the Spotlight tonight, “the Daily Beast” notes that the Republicans‘ most promising presidential candidates all share something they hope to keep secret, because it could derail each of their chances for winning the Republican nomination. Former Governors Tim Pawlenty, Mitt Romney, Mike Huckabee and current Governors Mitch Daniels and Haley Barbour, in one form or another, all raised taxes while serving as chief executives of their states.
While governor of Minnesota, Tim Pawlenty balanced the state‘s budget through increases in cigarette and corporate taxes. He also cut state aid to local governments, thereby forcing an increase in local property taxes, which can be tagged to Pawlenty.
While governor of Massachusetts, Mitt Romney raised fees on things like marriage licenses, gun permits and community college tuition. He then raised taxes on used cars and corporations by closing loopholes. An executive at the state‘s largest business lobbying firm told the Associated Press “his indicating he balanced a budget without raising taxes is misleading at best.”
In his first State of the State Address, Indiana Governor Mitch Daniels proposed raising taxes on people making 100,000 dollars or more. He then raised taxes on liquor and rental cars, and increased the sales tax. But unlike his Republican colleagues, Governor Daniels has not pledged to never raise taxes if he runs for president.
Joining me now, the author of that “Daily Beast” report, senior writer from “Newsweek” Andrew Romano. Andrew, thanks for joining me tonight.
ANDREW ROMANO, “NEWSWEEK”: Thanks for having me.
O‘DONNELL: So which one of these potential candidates has the worst problem? Let‘s focus in on Romney and Pawlenty, because they are definitely candidates.
ROMANO: I think Pawlenty has sort of an interesting problem here, because he‘s really drawn a hard line on taxes, said that he didn‘t raise any of them while he was governor of Minnesota. In fact, as you said in your intro, he did raise a couple of taxes, the cigarette tax and a couple of others.
But the big thing is that property taxes in Minnesota have gone up over 50 percent. Taxes overall have gone up for 90 percent of Minnesotans on his watch. That‘s going to be something that he‘s going to have to explain when he runs for governor.
The fact is—sorry, when he runs for president. The fact is that he‘s got a 6.2 billion dollar two-year deficit there that he left behind. So sort of his failure to raise enough taxes might come back to bite him.
O‘DONNELL: And Romney?
ROMANO: Romney‘s big problem is that he—
O‘DONNELL: This is—I mean, he‘s got the big problem of health care in Massachusetts, which I don‘t see how he overcomes that.
ROMANO: Right.
O‘DONNELL: But then he‘s got this.
ROMANO: If he can overcome it.
O‘DONNELL: He cannot, but he‘s got this too.
ROMANO: If it gets to this, the problem for Romney is that he raised all kinds of fees in Massachusetts. He also closed corporate tax loopholes, raised hundreds of millions of dollars in new revenue. He did balance the budget by doing this. But he goes around saying that he didn‘t raise any taxes at all. And frankly it comes down to a semantic argument about closing loopholes, raising fees; is that taxes?
And, you know, Romney doesn‘t want to get into even more arguments over semantics and flip-flopping.
O‘DONNELL: Mitch Daniels, who I think is probably on the fence about running, may not run—on this program I asked him if he would pledge as a candidate for president to absolutely take taxes off the table and never consider raising tax. And he said he thinks he would not want to make that promise while running for president.
He would want to leave the options open going into the White House. Now, that seems to ruin him in Republican debates, in any kind of Republican primary debates, because all the rest will take the pledge no matter their history.
ROMANO: Right. That‘s one of the things about Daniels. I actually asked him the same question. I was out in Indiana. I did a profile of him. He said, you know what, if it‘s the second or third option, I‘d be willing to do it. He‘s since come out in potential favor of the value-added tax, a tax on gasoline, as ways to sort of balance the budget and tackle the deficit.
It shows that he‘s serious about it. Frankly—
O‘DONNELL: He‘s way too reasonable to get the Republican nomination. He doesn‘t have a chance. Andrew Romano, senior writer for “Newsweek,” thank you very much for joining us tonight.
ROMANO: Thank you.
O‘DONNELL: Coming up, there is one man standing in the way of Republicans doing the right thing when it comes to taxes. He‘s in the Rewrite.
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O‘DONNELL: Time for tonight‘s Rewrite. And time for you to meet the most powerful man in America. No, I‘m not talking about that man, although he is very powerful. And I guess he is the most powerful man in America when you factor in his war-making powers and his right to nominate Supreme Court Justices.
I guess I was thinking the most powerful man in America who does not sleep in the White House, the man who prevents the man in the White House from getting what he wants, the man who controls the most important domestic power the government has, the power to tax.
This man has never been elected to anything. He‘s too smart for that. Instead, he controls the people who do get elected. He controls their position on taxes.
Meet Grover Norquist, the president of Americans For Tax Reform, whose mission statement is, quote, “the government‘s power to control one‘s life derives from its power to tax. We believe that that power should be minimized.”
Grover Norquist has won more anti-tax battles than he‘s lost. He‘s prevented any increase in income tax rates or the gasoline tax for the last 18 years. There are some Republicans who have thought that perhaps—perhaps, maybe we should have raised taxes to pay for the Iraq and Afghanistan wars, or at least partially pay for them.
But they would not dare say so, because that would violate a written pledge they had made to Grover Norquist, who presents every Republican running for the House, the Senate, or the White House with a pledge to sign, saying that he or she will never, ever support raising taxes in any way, including by cutting loopholes out of the tax code that might then force an individual or corporation to pay a higher tax bill, something closer to their actual rate that they‘re supposed to pay.
Grover Norquist has the signatures of virtually every Republican member of Congress on a document pledging not to raise taxes. He‘s prepared to use that document against any Republican who violates that solemn oath that Republicans take to Grover Norquist, to follow the dictates of Grover Norquist.
So John Boehner and every other Republican leader says tax increases are off the table, not to be discussed, never. Don‘t even think about it, no matter what.
So successful is Grover Norquist‘s lock on Republican thinking that it has extended its influence to Democratic party thinking, including President Obama‘s thinking. When George W. Bush came into office, he proposed cutting every income tax rate from the top income tax bracket down to the bottom tax bracket. And Congress did so, even though the country had thrived under the Clinton income tax brackets.
The Democrats‘ position and the president‘s position is now to restore only one—only one of the Clinton tax brackets, the top bracket. The Democrats agree with Grover Norquist and the Republicans on virtually everything else in the tax code.
That is how profoundly effective the Grover Norquist anti-tax campaign has been, total mind control over Republicans and partial mind control over Democrats.
Until now. Grover Norquist is accusing Republican Senator of Oklahoma Tom Coburn of violating the pledge. And Senator Coburn is actually fighting back. To his Republican colleagues‘ awe and amazement, Senator Coburn is struggling to eliminate the ethanol tax credit, a five billion dollar giveaway through the tax code to the ethanol industry.
What Senator Coburn sees as the elimination of an egregious tax loophole, Grover Norquist sees as an increase in taxation on the ethanol industry.
If you were a collector of politically brave letters written by United States senators, you would not need much storage space. A shoe box would do, and still leave room for at least one shoe.
I give you now excerpts of the politically bravest letter written by a United States senator this year, dated March 29th, 2011. “Dear Grover, unfortunately, this is not the first time your organization has defended distortions in the tax code. In 2009, you defended a 246 million dollar tax earmark for Hollywood movie producers. You opposed my amendment on the grounds that it was a tax increase.
“Fortunately, dozens of Republicans who signed your pledge exercised good judgment and common sense and voted to help pass my amendment. Now your organization is working to protect an ethanol subsidy the Heritage Foundation and others have called a tax earmark because it is a special interest giveaway targeted to a narrow group of recipients.
“The Council for Citizens Against Government Waste also supports my
amendment and will consider any votes on the matter in their 2011
congressional ratings. As Council for Citizens Against Government waste
President Tom Schatz wrote in support of my amendment, ‘at a time when the
nation‘s debt has ballooned to more than 14.2 trillion dollars, members of
Congress should be looking for every viable way to cut wasteful,
unnecessary, and duplicative spending.‘
“By opposing my amendment, you are defending wasteful spending and a de facto tax increase on every American. Ethanol subsidies are a spending program, wrongly placed in the tax code, that increases the burden of government, keeps tax rates artificially high, and forces consumers to pay more for food and energy.
“Rather than demanding that Senate conservatives violate their consciences and support distortions in the tax code that increase spending and maintain Washington‘s power over taxpayers‘ lives, your organization should assist our efforts. Calling for the elimination of tax earmarks without qualifications would be a good start.
“Continuing to issue blanket defenses of all tax expenditures is a profoundly misguided embrace of progressive activist government, and a strategy for tax complexity, tax deferment, excessive spending, and unsustainable deficits.
Sincerely, Tom.”
U.S. Senator Tom Coburn.
We can only hope that this is the first shot fired in a Republican rebellion against Grover Norquist‘s lock on their thinking about tax policy. We are in the fiscal straits we are today thanks as much to Grover Norquist as to any other individual, including George W. Bush. If a handful of Republicans in the Senate and the House are now willing to follow Senator Coburn‘s lead and, for the first time in their careers, think for themselves about tax policy, we might, just might, be able to begin to hope that we can find our way out of the fiscal mess that Grover Norquist‘s simple minded pledges have created.
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O‘DONNELL: Tea Party Republican and Arizona Governor Jan Brewer, notoriously anti-immigration, anti-health care, and pro-gun, surprised everyone yesterday when she vetoed a bill that would have allowed firearms on parts of college campuses, and a Birther bill that would have mandated specific documents as proof of U.S. citizenship for presidential candidates.
Governor Brewer explained her Birther bill veto this way: “I never imagined being presented with a bill that could require candidates for president of the greatest and most powerful nation on Earth to submit their early baptismal, circumcision certificates, among other records to the Arizona secretary of state. This is a bridge too far.”
Governor Brewer said she vetoed the gun bill in part because it wasn‘t clear whether the phrase “educational institution” could be applied to elementary and high schools as well as to college campuses. The bill‘s sponsor called it, quote, “a very rude veto letter.”
Joining me now is Howie Fischer, chief correspondent for Capital Media Services in Phoenix. Thanks for joining us tonight, Howie.
HOWARD FISCHER, CAPITAL MEDIA SERVICES: Glad to be here, Lawrence.
O‘DONNELL: Howie, we‘re surprised that she would veto this bill that was clearly written to create—try to create problems for President Barack Obama getting himself on the ballot for re-election in Arizona. It listed a bunch of documents that you could present for qualification, everything except what we know Hawaii issues to people who are born in Hawaii. Did you see this veto coming?
FISCHER: I did, for a couple of reasons. I think number one is that this governor had been the secretary of state before she was—became governor two years ago. And she recognizes the limitations of the duties of the secretary of state‘s office, and the idea that you‘re going to have the secretary of state determine what are qualifications for federal office.
Number two also became the problem that it would allow the secretary of state, even if he or she got the documents, to say I don‘t really believe that this shows that the person is qualified to be the president of the United States.
And then finally, as you pointed out at the top of this report, there‘s sort of that “ick” factor, that somehow if a candidate can‘t produce a, quote, long form birth certificate, that we were going to start getting into the president‘s circumcision records. I think that, as the governor said, was a bridge too far.
O‘DONNELL: Howie, what kind of political pressure was she under, given that her party passed this bill easily?
FISCHER: Well, I think there was a certain amount of political pressure. But even within some of the Republicans who voted for it simply because it seemed like a good partisan thing to do, there are a lot of folks that—this was not a going-home bill. This wasn‘t like an abortion issue or a gun issue or even an immigration issue.
This was something to, quite frankly, tweak with Barack Obama and to try to get an issue into court. And none of them, I think, were terribly disappointed or terribly surprised that she did this.
O‘DONNELL: Now, Senator McCain tweeted his support for the governor‘s veto. Was there any word from Senator McCain before the governor‘s veto indicating he had a position on this?
FISCHER: Not really. Obviously, Senator McCain had a particular interest in this. You have to remember, he was born in the Panama Canal Zone. And you get in some really fascinating questions there that if the secretary of state during the last presidential election had gotten something showing a Panama Canal Zone birth certificate, would the secretary of state say, well, my definition of what is a natural-born U.S. citizen doesn‘t fit that.
And I don‘t think that John McCain wanted the secretary of state, who happened to be Jan Brewer at the time, going ahead and doing that.
O‘DONNELL: Howie Fischer, chief correspondent for Capitol Media Services in Phoenix, thank you very much for joining us tonight.
FISCHER: You‘re very welcome.
O‘DONNELL: That‘s going to be it for THE LAST WORD tonight. “THE RACHEL MADDOW SHOW” is up next. Good evening, Rachel.
END
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