JEFFREY BROWN: President Obama’s $447 billion jobs bill faced a key test vote in the U.S. Senate this evening. Republicans moved to block the proposal, which includes a combination of tax cuts and infrastructure spending.
In Pittsburgh today, the president urged lawmakers to pass the bill, while in Washington, Senate Republican leader Mitch McConnell said the plan was just more failed stimulus.
PRESIDENT BARACK OBAMA: This is a moment of truth for the U.S. Senate.
In front of them is a bill, a jobs bill, that independent economists have said would grow this economy and put people back to work. This is not my opinion; it’s not my administration’s opinion. This is people whose job it is for a living to analyze and evaluate what kind of impact certain policies would have. They have said this could grow the economy significantly and put significant numbers of Americans back to work.
SEN. MITCH MCCONNELL, R-Ky., minority leader: Americans deserve more than a clumsy political stunt. They deserve better than the same well-rehearsed talking points we have been hearing from Democrats over the past few weeks. Above all, they deserve a different approach to this crisis than the one they have gotten from Democrats over the past few years.
JEFFREY BROWN: For more on the president’s jobs plan in Congress, Judy Woodruff talked to two senators a short time ago.
JUDY WOODRUFF: Joining me are Democratic Sen. Carl Levin of Michigan and Republican Sen. Johnny Isakson of Georgia.
Senators, it’s good to have you with us. Thank you.
SEN. CARL LEVIN, D-Mich., Armed Services Committee chairman: Thank you.
SEN. JOHNNY ISAKSON, R-Ga.: Good to be with you, Judy.
JUDY WOODRUFF: Let me just try to break this up into a few questions hopefully to get to the heart of this.
And one is, Sen. Isakson, the president says we have an economic emergency, that the country needs to do something right now to create jobs. Is he right?
SEN. JOHNNY ISAKSON: I think he’s right that we have an emergency. I think the way he wants to go about doing it is all wrong.
I think we need to revisit what happened with the first stimulus and why it didn’t work and look at what is causing corporate capital to sit on the sidelines. It’s over-regulation of American business.
JUDY WOODRUFF: And what do you think should be done in the short term that’s different from what the president suggests?
SEN. JOHNNY ISAKSON: Well, the first — I would do three things.
The first thing I would do is have a time-out on regulation and try and let business absorb what’s been put on them during the last two years without threats of more. We have already got the health care bill coming on top of us in 2014, which is going to be another suppressant on the economy.
Second, I would have a preferential tax on repatriation of offshore-stranded profits, which would bring capital in this country, predicated on it being invested in job creation. That’s two things you could do that would make a real difference and make a difference in a hurry.
JUDY WOODRUFF: And, Sen. Levin, are those alternatives that could work?
SEN. CARL LEVIN: Well, when you talk to the small business people, and according to the National Federation of Independent Business, who have taken a poll of small business people, the problem isn’t regulation. The problem isn’t taxes.
The problem is a lack of customers. And so what you need to do is really help two groups out there who are the ones that create the jobs. One are small business people. And the president’s bill has a couple major provisions in there that will help small business people. And the second thing you need to do is to get folks working again, because the middle class creates jobs when they’re working and when they’re consuming.
And you need to have a stimulus. I think the last stimulus package obviously didn’t do what we wanted it to do, but without that stimulus package, according to most economists, you would have had a depression, instead of a recession. And I think most economists who have been surveyed by Bloomberg this time say the president’s package, it will do some good.
And according to the Moody’s economist Mark Zandi, there will be a 2 percent increase in gross domestic product with the president’s package and about 1.9 million additional jobs. So it’s not regulation, it’s not going after EPA which is going to do the job here. It’s getting people working again. And that requires a couple things: support for small business and again to do some direct infrastructure work and some of the other things that are directly provided for in this jobs package.
JUDY WOODRUFF: And, Sen. Isakson, why is that formula wrong?
SEN. JOHNNY ISAKSON: Well, I appreciate Carl talking about small business. I ran one for 30 years in Georgia. And I do know that’s where the heart of the jobs are. But the vote we have tonight is a vote to put the millionaire surtax as a pay-for for the president’s jobs bill.
That surtax is going to raise the taxes on 392,000 small businesses in the United States of America, which will be a retardant to jobs coming back, not a help.
JUDY WOODRUFF: Well, Sen. Levin, and one hears this from other quarters as well, that instead of hitting millionaires, this surtax — and it will hit a third of them, I’m told, because most of them earn that income from capital gains — that it will hit many, many small businesses and do the opposite of what the president wants.
SEN. CARL LEVIN: As a matter of fact, one-third of 1 percent of small businesses make a million dollars a year. That’s not the issue here.
The issue here is whether or not millionaires, who have done incredibly well — the only group that has done well in terms of income in the last couple — in the last decade or so, is the upper 1 percent. Their share of the income has gone up from 10 percent of our national income to almost 25 percent of our national income. That’s just the wealthiest 1 percent have done so well.
The middle class have done very, very poorly. They have taken a hit. So there’s no point in protecting millionaires by claiming that these are small business people. A tiny percentage of small business people are millionaires, make a million dollars a year.
It’s the folks that have done so well making millions that are not small businesses, the executives whose pay has skyrocketed, that need to be — have some tax fairness applied.
JUDY WOODRUFF: Sen. Isakson, is there anything you can add to that argument? Clearly, the two of you come at this differently over whether small businesses would be hit by this millionaire’s tax. Is there anything you can add to that to help your side of this argument?
SEN. JOHNNY ISAKSON: Well, you know, I love Carl Levin to death, but his answer to that question just proves this is all about political messaging and really doesn’t have anything to do with purpose, because if they really cared about small business, they would exempt limited liability corporations, S-corporations and sole proprietorships from the application of this tax.
Then they’d only be taxing millionaires. But they’re going after small business as well.
JUDY WOODRUFF: Sen. Isakson, what about this other argument one hears from economists across the spectrum that — you hear it from independent economists and others — and that is that this is the exact time when the government doesn’t need to be cutting spending and contracting, that, if nothing else, what the country needs is government to spend some more to get more money in circulation?
SEN. JOHNNY ISAKSON: We have a select committee of Republicans and Democrats named by the Congress to try and find $1.2 trillion in savings because we have a debt problem and a debt crisis.
And the last stimulus bill paid school teachers’ salaries for a while and kept them employed. And I understand that helps the economy. But the minute that money ran out, they became unemployed in the states because they were struggling. What we need to do is empower small business and empower capital investment in this country and return confidence to the consumers of America.
JUDY WOODRUFF: So, you just don’t buy the argument that contracting is the wrong thing to do when the country’s economy is scooting along the bottom?
SEN. JOHNNY ISAKSON: I buy this argument. You know, leverage is a good thing. I was a real estate guy for 30 years, but too much leverage will kill you.
We’re at the breaking point of too much leverage as a country. I don’t want to bankrupt our country because we borrowed too much money and weren’t accountable. I want to try and inspire the private sector to reinvest in our country and reinvest in their businesses.
JUDY WOODRUFF: Sen. Levin, if the president’s job bill doesn’t pass in its entirety, there’s already talk about splitting it up into pieces. Are there pieces that at this point you think Republicans and Democrats could agree on?
SEN. CARL LEVIN: Well, I think Republicans and Democrats over the past few years have voted for this bill in various — various pieces of this bill already. And that’s why some Republicans really ought to vote for this bill, because there’s so much in this that many Republicans have previously supported.
There’s a lot of capital that’s sitting on the sidelines. We don’t need more tax cuts to continue to go to upper-income people. We shouldn’t be protecting millionaires from the restoration of that 3 percent higher tax rate that they were paying prior to the Bush tax cuts.
JUDY WOODRUFF: But is there something in here…
SEN. CARL LEVIN: While we’re cutting teachers, while we’re not building the kind of roads that we have to do — this jobs bill directly will hire back teachers and cops and firefighters. It will build roads and bridges. And that is what we need in the short term.
JUDY WOODRUFF: And — but let me turn to you, Sen. Isakson. Are there pieces of this legislation that you think the two sides could come together and agree on in the short term?
SEN. JOHNNY ISAKSON: Yes, ma’am, there are. And if we get off of political messaging and get down to the work we’re supposed to be doing, we could probably do that.
JUDY WOODRUFF: What…
SEN. JOHNNY ISAKSON: Roads and bridges, infrastructure construction makes a difference.
There are some pieces of this legislation that make some sense. But it doesn’t make sense to destroy capital investment or to run capital investment away by having selected taxation and creating enemies in this country. It’s time we empowered the entire private sector.
JUDY WOODRUFF: So, just in a word, extending the payroll tax cut?
SEN. JOHNNY ISAKSON: That’s one of those things you can sit down and talk about. But as long as you have the medicine all in one big teaspoon, you have got to swallow it all, good and bad, it’s not going to pass the Congress.
SEN. CARL LEVIN: But what we haven’t heard from Republicans is what their alternative is. All we hear is less regulation, less taxes for upper-income folks.
That’s not what the problem is, according to the small business community, which has been surveyed on this.
JUDY WOODRUFF: All right.
SEN. CARL LEVIN: The problem is lack of customers. And that’s really — but the middle class needs to be supported in this country, not the wealthiest among us.
JUDY WOODRUFF: We’re going to leave it there.
Sens. Johnny Isakson, Carl Levin, we thank you both.
SEN. CARL LEVIN: Thank you.
SEN. JOHNNY ISAKSON: Thank you.