Ronan Farrow Daily   |  March 04, 2014

Obama unveils new budget plan

President Obama released his proposed annual budget for 2015, which would expand the Earned Income Tax Credit, offering federal assistance to 13.5 million workers. CNBC's Steve Rattner discusses with Ronan Farrow.

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This content comes from Closed Captioning that was broadcast along with this program.

>>> hello, folks, welcome back to "rf daily." we got developing news as the president released his proposed budget for 2015 . that plan would expand the earned income tax credit which offers federal assistance to 13.5 million low income workers, it would cost $60 billion, over the next decade. where is that money going to come from? well, the plan also closes two tax loopholes for the ultrawealthy. take a listen.

>> right now our tax systems provides benefits to wealthy individuals who save, even after they've amassed multimillion dollar retirement accounts. by closing that loophole we can create jobs and grow the economy and expand opportunity without adding a dime to the deficit.

>> house budget chairman paul ryan already come out swinging against the plan. yet another disappointment and added the president has three years left in his administration and seems determined to do nothing about our fiscal challenges. that's paul ryan . this budget isn't a serious document he says. will this budget proposal help flagging republican opinion of president obama 's track record. we turn now to financeer and former treasury official and cnbc economic analyst steve radener. thank you for being here.

>> thanks for having me.

>> i wanted to start out with your gut reactions to this. is it the expanded credit for low income workers?

>> this is a policy statement of what he believes should happen in the budget, more spending on things like the earned income tax credit which is today's headline but also things like infrastructure and pressing needs. he wanted to put out what he believes in and indeed what the democrats believe in in advance of mid-term elections.

>> you have a background in private equity yourself and roll with a crowd of people most affected by the closed loopholes. what is the reaction you're seeing from colleagues and people on wall street ?

>> this is not necessarily a new f proposal, it's been talked about for a good while. it's a mixed reaction. some people in the private equity world and i'm still a beneficiary of that loophole who believe the right thing is to close it. it should be tax like work and shouldn't be a special break. there are others with a different view. there's a mixed view in the private equity community about this.

>> but you are clearly taking a frank stance on it yourself?

>> i think people who work for a living and get paid at the top salary, pay 40% now. people who have the benefit of the loophole pay 20%. i don't really understand the argument for why someone -- some of these people who make hundreds and millions of dollars a year should be paying a 20% tax rate instead of 40% that someone who has a job in a corporation pays.

>> that is a strong, clear statement. what been the political prospects? is this something that could ever feasibly get through the hill?

>> this is honestly just a statement. we have gridlock on capitol hill . nothing is happening. as part of resolving the government shut down last fall, two sides agreed on a two-year plan and they can go back and agree on something else. as you heard paul ryan state his views, in the current climate, this is really -- to his credit coming out and saying, this is what i believe in. i wouldn't hold your breath until this happens.

>> the latest polling on the economic track record has been pretty harsh. do you think that this proposal has an opportunity to turn any of that around?

>> the president's problem is because we still have high unemployment and wages are not going up. i don't blame him for either of those. but what i think he hopes for and what i would hope for is that as we get into the mid-term elections and people as they do every two years have a choice between two different visions for how they want the government to function and what they want the government to do. the people will see the president's budget has a better chance of reversing unemployment problem and income problem than what the republicans want to do.

>> all right thank you for that assessment. always a pleasure to be with you.

>> thanks so much, ronan.