Camp: We Need Spending Cuts To Avoid Fiscal Cliff
ROBERT SIEGEL, HOST:
Rep. Dave Camp is a Michigan Republican, and chairman of the House Ways and Means Committee - the tax-writing committee. I asked him about the biggest tax breaks, the ones that cost the Treasury the most money. Not taxing the money that employers spend on health insurance or pension contributions - are those loopholes on the table? Well, Camp wouldn't talk about specific tax breaks.
REP. DAVE CAMP: Well, at this point, what we want to do is have a framework to get us through this end-of-the-year fiscal cliff problem; and then move to comprehensive tax reforms, where the committees in the House and Senate will write the tax bill. So obviously, as we go through that, we'll be looking at all of the tax expenditures; and finding a way that we can get consensus to move forward on what would the revenue - that the president's demanding - need to be; so that we can raise that revenue, but do it through pro-growth policies, and then have, literally, a public discussion about what are those provisions that we should keep, and not keep. But to do that now, is really premature. You can't really get there now.
SIEGEL: But, you know, it's premature now. But within a year, we'll be a year away from a congressional election, and it'll be too late to do these things. So when you hear that, is it just something that's out of the question - we can't tax benefits that we're receiving?
CAMP: We're going to look at all of the tax provisions, and find a way to get the best pro-growth policies we can get. Now, we are - we can do that, I believe, in a way that will grow our economy. And that's what - where we're really lacking, in this country. And when you look around the world, other nations have done it. They've simplified their tax codes; they've lowered their rates; in an attempt to really get people back to work. And that's what we need to do.
SIEGEL: Some other nations have eliminated favorable tax treatment of mortgage interest. We count it as a deduction. Some people say it's so pro-growth, it helped overgrow the home construction and housing sector. Is it a sacred cow? Or is it on the table, and something you guys will be talking about all year?
CAMP: Obviously, we'll have to reach consensus on that. It's, clearly, one of the larger items. But we have to understand that that is the way most people have invested their savings; and their home is their number one investment vehicle. So I think that one has to be looked at very carefully. Obviously, we'll need to reach political consensus on that. But clearly, it will be one of the discussion points.
SIEGEL: Well, given how little can be accomplished in the next couple of weeks, is - if you can't have comprehensive tax reform in the month of December, or in half of December - in terms of the revenue side here, would you - Republicans now acknowledge, there will be some kind of increased revenue; what can be accomplished in December? Can you just, say, raise the rates on the top 2 percent of taxpayers? Is that something that could be accomplished, in this short time frame?
CAMP: Well, revenue alone won't solve our problem because we know we have long-term drivers of our debt and spending. So revenue will have...
SIEGEL: No - but as the revenue component, though, of a mixed package in which there would presumably be three times as much in spending cuts.
CAMP: There will be a revenue component, but there also needs to be the savings component. We have yet to hear - we've signaled that we are willing to discuss the revenue side. We need to have the president and - come forward and discuss the savings side. Where are the savings going to be? He has yet to do that...
CAMP: It's time he got serious about that and began - to come forward with that. Once we establish those items, that will be a framework that will then allow us next year to move to comprehensive tax reform; which will be done through the regular committee process, and will be very public. And people will be aware of it; and they'll know what items we're discussing, and which ones we'll be talking about. But right now, it's to avoid the fiscal cliff - which is really the effort. And that's why we need this framework in place.
SIEGEL: Are you suggesting, in effect, a small package right now - and a larger number, in principle - and then fill in the gaps next year, basically?
CAMP: No. What I'm suggesting is a larger package now, that begins with a down payment for the end of the year so we can avoid the fiscal cliff.
SIEGEL: A down payment - both in revenue and spending cuts?
CAMP: Both in revenue and spending, extending all of the current tax policy for one year. We then move toward whatever the ultimate revenue number is next year, through comprehensive tax reform; where we raise the revenue, and implement the spending reductions, that will get us to the balanced approach that the president's talked about - whether that's three-for-one or two-for-one or one-for-one; whatever the solution ends up being. We get to the end of the day next year, by completing this agreement that is struck this year.
SIEGEL: Are you building a little ledge out from the cliff, that just lasts another year; and then you'll have the same problem next year?
CAMP: No, because you'll have an agreement to implement these things now; and you'll have a down payment of good faith, to begin that process. And then what you'll do is, move to reform and have a backstop so that - ensures reform occurs.
SIEGEL: And how big is a down payment, in your view?
CAMP: Well, again, I think that's something that needs to be negotiated. I think the numbers that we've been hearing, out of the White House, are far too high because they will prevent us from moving forward on the kind of tax reform that will be pro-growth.
SIEGEL: Well, Dave Camp - chairman of the House Ways and Means Committee, a Republican of Michigan - thanks a lot for talking with us, once again.
CAMP: Hey, thanks a lot, Robert. Take care.
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