MR. GREGORY:
Good to have you here. And it's an important time. The end of the week saw you and the president closing a very important deal, this compromise over an extension of the
Bush
-era
tax cuts
, a bill signing at the
White House
, striking in that you had a Republican there...
VICE PRES. BIDEN:
Yeah.
MR. GREGORY:
...
Mitch McConnell
,
for the first time
. So a new era, perhaps, in
Washington
. The bottom line is the focus on getting people back to work. What does this deal mean to the end of that goal?
VICE PRES. BIDEN:
This means two things. Number one, every econometric model, every basic economist out there says, look, this is going to grow the
economy
faster next year than it would have. The projections are instead of the
economy
growing at a -- the
GDP
growing at a roughly 2.5 percent, some suggest it would grow as high as 4 percent. That means employment. That means more people employed, number one. Number two, this wasn't just extending the
Bush
-era
tax cuts
. It extended all the
tax cuts
for the
middle class
and all the
tax cuts
for the poor that were in our legislation, the
Obama
legislation. We came up with a
tax cut
of two percent for everybody who gets a payroll check, and on their -- not the employer, the employee gets a two percent. For example, someone making $60 grand a year is going to get another $1,200 on top of the
middle
-class
tax cut
. We continued all those
tax cuts
for the working poor, the so-called
EITC
, earned
income tax
credits, and maybe most importantly, were able to extend for another 13 months
unemployment insurance
for those devastated by this recession.
MR. GREGORY:
What about the prospect of eliminating uncertainty? In what may be the first salvo of the
2012
campaign,
Mitt Romney
said, "Look, this really doesn't solve the problem. This is not good for the
economy
because businesses understand that in a couple of years these rates are going back up."
VICE PRES. BIDEN:
No.
Look
, here's the -- businesses don't care about the top-end
tax cut
except those people making a million bucks. They're the ones that care. What the businesses care about are the extension of all of those
tax cuts
for business that we extended, the so-called extenders. For example, we provided for 100 percent expensing. The guy run -- runs a contracting company, he goes buy a $50,000 backhoe, he can expense it in one year now. That's going to encourage him to go out, invest, buy, build. And so all of those we hope we're going to be able to continue. The one target for us in two years is no longer extending the upper
income tax
credit for millionaires and billionaires, and scaling back what we had to do to get the compromise, the
estate tax
for the very wealthy.
MR. GREGORY:
But the president has said he thinks he can win this argument on the merits in...
VICE PRES. BIDEN:
I think he can.
MR. GREGORY:
Well, then why not do it now? Why wait until
2012
, an
election
year? Do you really expect, in an
election
year, that anybody's not going to vote to extend the
tax cuts
?
VICE PRES. BIDEN:
Yeah, I do. I do.
MR. GREGORY:
What'll be different?
VICE PRES. BIDEN:
Well, I think what'll be different is that we will have had the outcome of the
deficit
commission, we will be able to make the case much more clearly that spending $700 billion over 10 years to extend
tax cuts
for people whose income averages well over a million dollars does not make sense, number one. Number two, we're not going to be -- we're not in a position,
David
, where we're going to have,
God willing
, the shaky
economy
where we could not afford to continue uncertainty for a month or two or three in the next year had we not made a deal which would actually grow the
economy
. The, the obverse was equally as true. Had we kicked this into next year, it would have created such uncertainty, and there are a number of economists who thought that it would -- may, in fact, induce a double-dip recession. So we not only avoided it getting worse, we made it -- the prospects much better for the
economy
.
MR. GREGORY:
The, the irony of achieving this tax deal is that it does represent a broken promise by this president in how he campaigned, and how you campaigned as well.
In September
you were interviewed by my colleague
Rachel Maddow
, and you had an exchange about this fight over extending the
tax cut
for wealthier Americans. Let me play a portion of that.
MS. RACHEL MADDOW:
Does that mean that letting the
Bush tax cuts
expire for the
richest people
in the country while pushing for their extension, a
middle
-class
tax cut
for everybody else, is that a
black and white
issue? Is that a -- we haven't heard a veto threat, for example, from the president on that.
VICE PRES. BIDEN:
No, it, it is a
black and white
...
MS. MADDOW:
Is -- it's a
black and white
issue. That's something that the administration's going to go to the mat for.
VICE PRES. BIDEN:
It's a
black and white
issue. Yes, absolutely.
MR. GREGORY:
That was September.
VICE PRES. BIDEN:
By the way, we did...
MR. GREGORY:
By January, you didn't go to the mat.
VICE PRES. BIDEN:
By the -- we did go to the mat. We did go to the mat. We went through every -- I went into a total of 130 races out there campaigning for
Democrats
. Every single race I made this case. Here's what happened. We got to the end, we couldn't get it done, and we had
to make a decision:
Were we going to let the
middle
-class
tax cuts
expire? Let me remind everybody, the
House
passed
middle
-class
tax cut
only. It got to the
United States Senate
, we supported that provision, and the
Senate
could not pass it. So now we're left with, do we let those folks who are
going to bed
tonight staring at a ceiling wondering whether they're going to be in that same bed next month, or those two million people who already lost their
unemployment insurance
this month, seven million more losing it next month, and economic uncertainty occur? Life is a matter of really tough choices.
MR. GREGORY:
The president wrote in "
Audacity of Hope
" that he found the
Bush tax cuts
for the wealthy morally troubling.
VICE PRES. BIDEN:
They are.
MR. GREGORY:
Is that still his belief?
VICE PRES. BIDEN:
It's still his belief.
MR. GREGORY:
Your belief as well?
VICE PRES. BIDEN:
Mine as well.
MR. GREGORY:
But you're willing to compromise on that?
VICE PRES. BIDEN:
Look, it's -- the idea -- to compromise to save people who are drowning -- there's people out there drowning. There are two million people this month that can't afford to go get a
Christmas tree
, let alone buy any gifts, because their unemployment has run out, which means they've been unemployed for well over a year to two years. It is unfortunate we were put in the position where the
Republicans
made it clear they were ready to let everything fall unless they got these
tax cuts
. They're for two years. They're for two years, and we're coming back and going at it again.
MR. GREGORY:
Can you be thought of as being serious about cutting the
deficit
when 80 -- within 80 hours of, of announcing the
deficit
commission's proposals this administration agrees to add a trillion dollars to the
deficit
?
VICE PRES. BIDEN:
Absolutely, positively. Look what the
deficit
commission suggested. They suggested we do exactly what we did. They suggested we have a
payroll tax
. They suggested that we stimulate the
economy
this year into next year. They suggested that this has no impact on long-term debt because it's for two years. Look, you know this, the only people who are going to agree with me when I say this are the economists listening, left, right and center. In the
middle
of a recession, where we're just climbing out of it, where the
economy
-- unemployment is still at 9.7 percent, the idea of raising taxes and reducing spending is a prescription for disaster. No one is suggesting that.
MR. GREGORY:
Is the balance -- to that point, do we think the balance is out of whack? There's so much attention on austerity...
VICE PRES. BIDEN:
Yeah.
MR. GREGORY:
...on cutting the
deficit
. And yet,
Larry Summers
, the president's outgoing top economic adviser...
VICE PRES. BIDEN:
Yeah.
MR. GREGORY:
...saying, look, at this particular moment in time, the priority next year should be more spending. You're the shovel-ready projects guy. There should be more investment in infrastructure. Should there, should there be more of that before we really focus on bringing down the
deficit
?
VICE PRES. BIDEN:
We can do both. Let me explain what I mean. In the
budget
we submitted and the omnibus or the, or the, the, the -- I'm sorry to sound like a senator here, or a wonk. But in the spending proposal for next year, we freeze
discretionary spending
. Freeze it. Freeze it. We think we have to start by all those things that have tails on them, the long-term impact, we should not be spending in those areas and we should be freezing or reducing. On those issues that have no long-term
deficit
-- look, the entire recovery bill --
I know you know
this, but the entire recovery act of the last 18 months, over roughly $800 billion, you know how much it added to the long-term debt? Two-tenths of one percent to
GDP
. Two-tenths of one percent. The places where we have to go are those things that have tails, that are long-term commitments to the government. That's where the problem is, and that's what we have to attack.
MR. GREGORY:
You brought up spending and I want to talk about this earmark issue, not to sound wonkish, these are the pet projects that lawmakers...
VICE PRES. BIDEN:
No. Yeah.
MR. GREGORY:
...put into the
budget
; and you had a lot of back and forth here, and ultimately
Democrats
had a defeat. They pulled back their big spending bill, eliminated the
earmarks
. And yet,
Harry Reid
, the leader of the
Democrats
, took on the
White House
, wasn't
happy with all of this and said this, this week:
I am convinced that I do not want to give up more power to the
White House
, whether it's
George Bush
or
Barack Obama.
And I
'm going to fight as hard as I can against
President Obama
on these
earmarks
and my Republican colleagues who hate to vote for them, but love to get them.
SEN. HARRY REID (D-NV):
Bottom line is, if there is some temporary measure to keep the government funded, will the president down the road veto a bill that includes
earmarks
or not?
MR. GREGORY:
David
, if the question is, in order to keep the patient alive, we have to use medicine we don't like, we may have to do it. I'm not going to second --
if...
VICE PRES. BIDEN:
But the president said he regretted when he's done that in the past.
MR. GREGORY:
Well...
VICE PRES. BIDEN:
He regretted signing a bill with
earmarks
...
MR. GREGORY:
Well...
VICE PRES. BIDEN:
...and that after the
election
it was a new day.
MR. GREGORY:
Well, look, in this
budget
that was -- is being debated for -- to keep the government running for the next month and year, there is a freeze in
discretionary spending
. Also, there is an increase in spending for our troops that are in the
middle
of a war. Those two things we think are essential. Now, if you say to me, do we have to accept a project in -- and by the way, there were six Republican appropriators who supported this who had
earmarks
in it. If we say we have to support a, a levy in
Mississippi
in order to make sure my kid, who's out in the
middle
of
Iraq
or
Afghanistan
gets what he needs, I'm going to say yeah. I don't want to do it, but I may have to do it. It depends on the proportions. It depends on what to say.
Harry
just reinforced the point we've been making. We don't like
earmarks
. You have the Democratic leader criticizing the president of the
United States
because we say we don't want
earmarks
.
VICE PRES. BIDEN:
So, so you may not like it, but there's no veto threat.
MR. GREGORY:
No, there -- it depends on the proportion. It could be very well that you wind up in a situation where you say, "OK, in order to be able to have the funding for the continuation, the support for the troops in
Afghanistan
, we have to accept an earmark, and that's what the
Congress
sends us." Are we going to veto a bill that will jeopardize troop safety? Probably not. Conversely, if there's a bunch of
earmarks
in a bill that we think is funding for several agencies that we're willing to fight over and can take a chance on losing on, yeah, we'll veto.
VICE PRES. BIDEN:
“ ”