MSNBC "Interview With Senator Charles Grassley" - Transcript

Interview

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MS. MITCHELL: And now back to Capitol Hill, Charles Grassley, the Senator from Iowa, who is the senior Senator on Finance and was also at the budget hearings today with Tim Geithner.

Senator, thanks so much for joining us.

How good a job do you think, so far, the Obama economic team is doing at selling their giant budget proposal?

SEN. GRASSLEY: Well, I think they're doing a good job on selling it, but I think there are some things that they have said that without their intention of doing it, obviously, it wouldn't be their intention to make the stock market go down, but several slip ups have caused the stock market to go down and I think it's not a case of policy, so much as the case of how they express it or maybe talking down too much, too pessimistic as opposed to optimistic. I think that's changing a little bit now and maybe not thinking in terms of what impact they say.

So I think just a little bit more planning would make it show up in the stock market a little better, which isn't the only measure of things being better, but it's a significant concern of a lot of people right now.

MS. MITCHELL: What about the decision, the proposal to raise taxes on higher income people in the recession? Now, Geithner, Tim Geithner from Treasury and others have been defending that strongly, obviously. What about Republican opposition to these tax increases?

SEN. GRASSLEY: Well, right now, I think, first of all, they won't go up until 2011, but they're announcing of them now tends to have a dampening impact because, obviously, you don't raise taxes during a recession and people may read it as a tax increase even if it effectively it's not for 18 months, let's say.

But we tend to believe as Republicans as proven by the 2001 and 2003 tax bills, it may sound counterintuitive to most people, but you can reduce taxes and bring more revenue into the federal Treasury and if you looked at CBO figures on what we did in 2001 and '03, you'd see that we brought in $758 billion more than what the original tax law would have projected to bring in.

So we see increasing taxes as discouraging incentives, even among the wealthy of America and then the other thing is, I think, it leaves the impression that our tax code isn't more progressive now than it was before the 2001 tax bills and, in fact, the richest one percent are paying 40 percent into the federal Treasury of income taxes now compared to during the Reagan years paying in about 18 percent of the total tax bill coming in.

MS. MITCHELL: All right. Senator Grassley, thank you very much.

SEN. GRASSLEY: Thank you.

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