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Daniel Clifton, Strategas head of policy research, on why so much of the debate over the fiscal cliff has hinged on taxes, and why he believes the sol...
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Guest says the White House is ramping up its public campaign to pressure Republicans into raising taxes.
Joining us now did Clinton head -- policy research at Mr.
T -- research partners.
Didn't somebody or could you have tax background as well used to actually -- with.
Americans for Tax Reform right.
You know at this notion that the middle class is gonna get -- what's not a rich people don't carry rich people aren't gonna be affected by this at all that's crazy.
Well I think that the pain is gonna be spread around eventually when we get through this entire package itself.
But clearly the president campaigned on raising taxes on the wealthy.
I NEC and he's trying to get that through before the end of the year and obviously.
That will take a big leap of faith from the Republicans no Republican has voted for broad based tax increase in 22 years in the house or senate.
And so there's a real challenge here and I think that's why you see the Republicans trying to figure out a way to set up a two step process that would reform the tax code.
And reform the spending side -- equation could raising tax on the wealthy just -- the gonna get you to where we need today.
Completely gray and and I I also agree that we're not talking enough about entitlement reform but -- a month from taxes I think most Americans at this point are kind of Blake.
Resolved.
Or are at least continent terms with the notion their taxes are gonna -- -- somehow somewhere so we should Republicans give.
Well the Republicans are trying not to raise tax rates many small businesses pay the individual income tax rate rather than the corporate tax rates when you raise that tax rate it stifles new investment it leads -- less people getting -- -- Middle income workers so the Republicans are trying to figure out a way to limit deductions through -- hard cap or somehow being able to get a tax rate increase.
On all income rather than through graduated income tax structure seems rather complicated but you could see the Republicans are actually trying to work with the president.
What they're gonna require specific conditions before they get there.
-- and hopefully we and you know it's the million plus that navy seal little change not the 250000.
Dollar family.
Let's talk about entitlement reform now Dan because we have not really heard much about it have we at least over the -- -- last couple weeks.
Yet that's absolutely correct so we're trying to figure out whether we're gonna go off the cliff or not most people -- this tax rate issue that's gonna make the difference.
But I have to say once we clear attach radiation rates than when we got to go and figure -- the entitlement reform issues so so and this is -- -- be a lot -- many of the Democrats are all over the place raise the Medicare eligibility -- one says the other one says no don't do that.
Changes -- also security yes -- -- so there's mixed message this is gonna take a couple weeks and the clock is ticking towards the fiscal clip so I think it's gonna create greater anxiety in the markets over the next few weeks it's -- I'm sure -- -- about that 35 days so we fall off this fiscal -- and can you make a prediction what do you think's gonna happen do they come to some sort of agreement or do they punt to next year.
Well I do I think it's gonna be about half way of what you just said they're going to come out what -- temporary extension of most of the tax cuts.
There -- -- gonna -- our framework to raise taxes by about one point two trillion.
Cut entitlements by about one point five trillion.
But for the next six months in 2013.
Will actually figure out what the details are.
Between those tax and entitlement changes so.
Would get a little bit now we'll get a little bit early next year but I do think they'll come to an agreement before we go home for the holidays you talking about a lot of retroactive tax and spend a lot of paperwork Citi can stand -- -- went to tedious research partners -- when you're here sir.
Right thank you.
Our -- -- it is.
