Station KVOR

Show: Tom Tancredo Show

Guest: Doug Lamborn

Link: http://www.kvor.com/

Date: 7/06/2011

Topics: Budget, debt ceiling, earned income tax credit, Ryan Plan, Flat Tax

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Tancredo: Congressman Doug Lamborn. Congressman, how are you? Awake, I hope.

Lamborn: My body’s still on Colorado time

Tancredo: Good. That’s good, because it’s only 10:00 here, and I know that’s even still getting close to your bedtime. Mine too, buddy.

Lamborn: It’ll catch up with me in the morning, but I’m great for now. Tom, it’s an honor to be on your show. I always admired your service in Congress. I supported your run for governor, and it’s an honor to be on your show.

Tancredo: Well, thank you, and it’s an honor to have you. I appreciate it very much that you would take the time to join us this evening, especially because I wanted to get your take on what’s going on in Washington, DC. You heard that clip from the president suggesting that our desire – the Republican desire to have some significant spendings before we approve of the debt ceiling increase – is holding a gun to the head of the American taxpayer. Now, how can you possibly come to that conclusion, if you know anything about this situation? I cannot believe – you know, there are Americans out there that will hear that and somehow walk away thinking that that’s what going on. But, you know, it’s amazing to me that he can get away with this stuff, but he does, and we’re going to call him out on it of course, every time we get a chance here on our little show. And I hope the rest of the media will do the same, although of course, I know they won’t. So I have to tell you that we’ve got a news breaking item here – just came in from Newsmax, and it says that the GOP is going to agree to give up about $200 billion in new revenue – excuse me, agrees to up to $200 billion revenue. According to Senator Kyle, apparently talking today, he has agreed that there would be at least a $200 billion increase in federal revenues. He says it’s going to come through the sale of government property and additional fees for government services. What’s your feeling on that? Have you been apprised of that? It just came in about five minutes before I started the show, so I don’t even know if you’ve heard about this yet – just a Newsmax clip.

Lamborn: No I haven’t Tom – that’s new to me also. I do think that there are some loopholes we could close, like the ethanol subsidy –

Tancredo: Yeah.

Lamborn: Is something I think is bad policy for a lot of reasons – you know, putting food in our fuel tanks, and it’s not even that great environmentally. Plus, we should be using conventional fossil fuels, not some of these alternatives that are not really commercially viable.

Tancredo: I agree.

Lamborn: So I think that that’s one loophole we could close and no one would really – and we’d be better off. And the thing with corporate jets, you know – that’s so ridiculous. It’s just class warfare at its finest, and it’s only like $300 million a year, which is one-thousandth of what the president wants supposedly, and that’s even a lot less than what the Republicans want for cuts. So – but if that’s what he wants, you know, let’s give it to him.

Tancredo: Yeah.

Lamborn: It’s no big deal. I don’t really care that much, except that it sends a bad message to the successful and the job creators that “We’re out to get you,” and I don’t think that that’s a great message, but if that’s what he wants, you know – and he seems to be falling on a sword for that, let’s give it to him.

Tancredo: You know what, I absolutely agree, because it’s an insignificant issue, and that he will use to beat us over the head with forever if the things play out. And people don’t – you know, you just have to recognize that most Americans are not paying close enough attention to this. They, unfortunately, will succumb to the siren song that says, you know, “We have these corporate jets, and these corporations have way too much power, way too much influence.” You know, I wonder. Now – apparently – by the way, in the same article, Doug, it says that the house representatives and majority leader Eric Cantor floated a possible tax compromise, saying Republicans could agree in closing some tax breaks in the budget deal as long as they were offset with tax cuts. Do you think that that’s what he was referring to – was the ethanol subsidy and things like that.

Lamborn: I hope so, or the Earned Income tax credit, which is actually just a handout for those who pay no other taxes, and they file to return and actually get money back, although they pay money in. Those are things I could support. I took a pledge to not increase taxes as long as it’s offset with other tax cuts, so there’s no net tax increase, I’m happy. But the big thing here, Tom – and I know this is what you’re driving at – we have to cut spending. And we have to put in structural reforms. And those really far outclass and eclipse these minor loophole tightening that we might do, which are minor. Let’s do them to let the Democrats save face, so that they can enter into the deal, but we got to have massive spending cuts, and the president has said nothing about what really needs to happen. He’s talking about something on a 12-year time frame, and a couple or three trillion dollars, and using some cooked books to even come up with that. We have to have major, serious spending cuts to save the fiscal, financial health of this country. And then I want to see some structural reforms, Tom – like hard caps or a balanced budget amendment that will prevent us from getting into this situation again.

Tancredo: Doug, the whole issue of whether or not we can achieve our fiscal goal – those of us who are conservatives and are looking at this and saying, “This is our best chance,” I have not seen a better opportunity to accomplish those goals of coming closer to a balanced budget of really reducing some of the incredible government waste, and actually maybe, just maybe, reducing the size of government – the size and scope of government. We’ve got a chance –

Lamborn: Yes, exactly.

Tancredo: To do it.

Lamborn: And this is the time to do it. And we obviously have their attention, or the president wouldn’t be saying those inflammatory and condescending things that he’s saying.

Tancredo: Do you think, however – and I don’t know, maybe better – we might save this to when we come back, because the answer might take a while. When we talk about the – what needs to be cut in order to achieve some degree of fiscal sanity – it’s certainly apparent, and has been for a long, long time that there isn’t enough money in discretionary outlays in order to accomplish that goal. If you eliminated the entire discretionary fund – that, by the way, would include the military – that’s in the discretionary side – you really wouldn’t achieve the goal of even a balanced budget for this year. You’d still have a deficit, if I’m not mistaken. And it certainly wouldn’t do anything in terms of the debt. So the only way that you actually get – and maybe the structural reforms that you’re talking about would apply here, and that’s what I’m going to ask you to refer to when we come back. But it does seem, Doug, that the only way you get to those levels of cuts that are necessary will be some change in Social Security and Medicare. And what I’d like to know from you is: number 1 – how you feel about that, and number 2 – whether or not believe they have so politicized that discussion that it’s not become the real third rail of politics. And we’ll get your response to that when we come back. This is Tom Tancredo, 740 KVOR. We’ll be right back. We’re back. It’s 10:18. We have Congressman Doug Lamborn with us from Washington, DC. Once again, I want to thank him for doing this, because the hour is late out there, so we’ll get right to it, Doug. As I mentioned before we went out for the break, it seems to me the only way we’re going to get to the kinds of savings that are necessary to actually turn this around, we have to deal with the issues, with Social Security and Medicare. Is that possible? Are there any plans to do so, and if there aren’t, how else do you deal with – where else do you get $4 trillion in cuts or whatever money they’re talking about.

Lamborn: Well, Tom, you’re exactly right when you say that the entire discretionary budget – which is $1.3 trillion, and that includes the military, food inspection, highways, agriculture, you know it – the entire non-entitlement part of the federal budget is $1.3 trillion. Our deficit this year is $1.6 trillion. So entitlements have to be addressed to get to balance. Now, I’m not sure we can get to balance immediately as much as I would like to, because that would be such a big change. I would love that – I’m prepared for that, but I just know the rest of Congress isn’t. So – but we need to take major steps toward that goal. Now, ultimately, whether it’s in the remaining budget bills for the departments this year that we’re in the middle of, that it applied to beginning October 1^st for the next fiscal year – yes, let’s bring in entitlements. And if we can do it in the debt ceiling negotiation, let’s do that as well. But I support the Paul Ryan plan – now it’s the Republican plan.

Tancredo: Yeah.

Lamborn: I proudly voted for that, Tom.

Tancredo: Good.

Lamborn: And maybe it’s not perfect, but it’s better than anything I’m seen from the other side. In fact, I haven’t seen anything from the other side.

Tancredo: That’s exactly right.

Lamborn: The Senate hasn’t had a budget in two years. The CBO said – they looked at the president’s budget or his initial speech, and they said, “We can’t score a speech.” So they’ve come up with practically nothing. They just want to snipe at us and not take any responsibility by offering a reasonable or realistic alternative.

Tancredo: Right.

Lamborn: But, yeah – sooner or later, we have to get to the entitlements. And the Paul Ryan plan – now it’s the Republican plan – really does do that. Now with Medicaid, we can block-grant that to the states. They have 50 different ways to approach it – not one size fits all from Washington. So they know what’s best for their particular state populations. That would be savings right there. Social Security is actually the easiest to fix by tinkering with some of the formulas that apply to years in the future. And with Medicare, I do like the plan of premium support.

Tancredo: True.

Lamborn: And this would be only people 54 and under – anyone 55 and older has no changes whatsoever, and premium support is popular in another context. With Medicare advantage, Tom, people like having plans to choose from, and seniors are capable of handling that responsibility. In fact, they like it. They like the options. So that’s all we’re talking about with those 54 and under, and that introduces some of the free market incentives and approaches to the system that are necessary to have competition. And if you don’t have competition, you’ll never bring prices down.

Tancredo: I can remember years ago – every time I would go speak to the docs about this to the doctors and the question of Medicare reimbursement came up, of course, every single time – and I always say, “The federal government has simply got to get out of the business of determining the value of a procedure, who can provide – you know, what pills you can take, what pills you can’t take. All of these decisions have got to be made at some other level, and hopefully, it would be made at the level of a patient and his or her doctor.” And that the only way we could get there, I used to say, was voucherize Medicare, and to allow people to take a voucher and go out and buy an insurance policy that fits their needs as best they can with what they can be – what they can add to it, or, if they can’t add anything, it’ll be a basic policy. But the government has got to get out of the business of being not only the provider of the financial support, but also, essentially, the provider of the service, by telling you who you can – because it sets up this mammoth bureaucracy – huge – that consumes so many dollars, so much of every single dollar that goes into Medicare that you’ll never absolutely be able to get a handle on it. We have to get out of that business, and that’s – from what I can tell, anyway – that’s exactly what Paul Ryan’s plan does.

Lamborn: Well, you’re exactly right, Tom, and also, people have to realize that the Obama plan contained in Obamacare ultimately leads – there is no other alternative under his plan than to ultimately ration health care. And that is the way they achieve savings, and I don’t think the American public would stand for that. You know, saying, “Well, your grandmother is one year past the cutoff – she’s not going to get the treatment that would prolong her life. We’ll give her painkillers.” I mean, whatever it would look like. I don’t know exactly what it would look like in every case, but rationing – the 15-member board that his Obamacare plan sets up is exactly intended and ultimately and inevitably, will lead to rationing, like they have in England and European countries. That’s how they achieve their savings.

Tancredo: Sure. And in all candor, though, rationing goes on constantly, and it really always has. The fact is that we all have to make decisions about – even our health care – what is it we can’t afford. I, you know, cannot afford the best possible insurance policy out there. I simply can’t afford it, so I have to take and look at what I have as options, and make a decision. And in a way, that’s rationing the health care that I could get. But you know what, I accept that, because I understand that we live in free market and capitalist system, and the last thing I want is the government to determine what is appropriate for me, and what is appropriate for everybody else. I know I will live with, you know, the fact that I am not a multi-millionaire, and there are a lot of thing that I’m rationed, you know – I can’t buy that other home in – well, where would I want to live – no place else, actually – Colorado Springs.

Lamborn:That’s right.

Tancredo: Can’t buy that other home there, you know, because I can’t afford it. Well, yeah – that’s exactly right. But having a government board, I mean, that makes it – I mean it takes all the decisions, of course, out of my hands. And I don’t want a bureaucrat doing that. So I certainly agree that what he is proposing – I mean, it’s also, don’t you think, Doug – it is simply another way to get the federal government to capture a bigger part of the economy of this country. I mean, he is a socialist. Barack Obama is a died-in-the-wool socialist. He wants at least European-style socialism here. And so, I worry. You know, one of the reasons why I am not going to be screaming and yelling if in fact we do some of the things that you and I were talking about in terms of some of the tax loopholes that might be closed, it’s okay, because, you see, I think he’s got us in a real bind with this debt ceiling thing. I think he would not care if the economy collapsed. He would blame it on the Republicans. I think that his – if you’re negotiating with somebody, and you both have the same goal, and therefore, you’re just working toward that goal in different, that’s one – there’s hope. But when your goals are completely different – ours being a sound economy, his being a catastrophic economy – because, if you have that, people tend to move toward more government as protection. They don’t tend to move toward individual capitalism, individual free enterprise. So I think he’s got us in a – between a rock and hard place on this – on this thing. And I have no doubt that we’re going to have to give up – I hope that it is just more of an illusion that reality. And one last thing – what do you think about – when we talk about cutting – you know, all these taxes for all the – or all the tax loopholes for corporations. What if somebody were to say, “Okay, fine, I am for doing that. There will be no tax loopholes. Zero, none. You make x number of dollars in the United States, you pay x number of dollars in taxes. And we reduce – in concert with that, you reduce corporate taxes to 10 percent or something.” Because 35 percent now makes us the second-highest in the world. We would have an influx of, you know, jobs, and the economy would grow, I think. And you’d be able to get rid of this canard that he uses all the time, and all Democrats who are intent upon this sort of class warfare thing that they do – you could get rid of it, say, “Okay, no more loopholes. That’s – they’re done, finished. Get – they’re out of there.” You know, we’re just going to reduce takes commensurately.

Lamborn: That’s exactly right, Tom. Right now, corporations or wealthy individuals spend a lot of their otherwise productive effort in work and their accountants and lawyers finding these loopholes or these tax avoidance ways of paying less in taxes. And if they had a fairer, flatter tax, they would channel that energy into productive pursuits that benefit the – all of society, instead of just looking for how to – how to reduce taxes. Right now, you have – like you have GE – who, large corporation, which pays zero in taxes. You have other companies paying full freight. You know, they pay the the full 35 percent, because they can’t take advantage for one reason or another of the different loopholes. So let’s have a flatter, fairer tax system. That would be better for everyone right there. The Republican plan does do that, by the way.

Tancredo: The Republican plan for the deficit – the spending.

Lamborn: Well, the 10-year budget plan. The budget plan.

Tancredo: Oh, okay.

Lamborn: The Ryan, now Republican plan.

Tancredo: Okay.

Lamborn: We go to 25 percent within 10 years. And – instead of the 35 percent – and that’s just the first step. We can do even better than that – but that would be what you could do without all of the distortions that you mentioned – the loopholes, the deductions, the credits that only apply to certain winners and losers.

Tancredo: You know what – it’s been my experience, Doug, that the one reason it’s so hard for the government to let go of graduated income tax is because it’s the best way to control people’s behavior. They really have a hard – you know what I mean. “If I want you to do something, I will give you a tax credit. If I don’t, I’ll tax that activity.” It is a control issues, just as much as it’s a fiscal issue, I think.

Lamborn: They could learn from Colorado. We’ve got a flat tax in Colorado.

Tancredo: That’s exactly right. Listen, you’ve been a great support. I sincerely appreciate it. We’ve had callers, but I just completely had so many questions for you myself, we couldn’t get there. But –