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( thunder rumbling )
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( rain falling )
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>> Man: HOW MANY PAGES
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IS THE U.S. TAX CODE?
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>> ( phone beeping )
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>> Woman: HOW MANY PAGES
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THE STIMULUS BILL IS?
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>> Man: NO, NO, THE TAX CODE.
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>> Woman: TAX CODE? UM, A LOT.
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I DON'T KNOW OFF THE TOP
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OF MY HEAD.
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>> ( extension ringing )
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>> Woman 2: WELCOME
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TO THE UNITED STATES
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GOVERNMENT PRINTING OFFICE.
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>> Man: YES, UM, I WAS TRYING
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TO FIND OUT HOW LARGE
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THE TAX CODE IS.
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>> Woman 2: I'M SORRY?
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>> Man: THE U.S. TAX CODE.
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I WAS CURIOUS HOW MANY PAGES
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IT IS.
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>> Woman 2: I'M NOT FAMILIAR
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WITH THAT, SIR.
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I DON'T KNOW WHAT
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YOU'RE REFERENCING.
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>> Man: IT'S THE DOCUMENT
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THAT CONGRESS COMES UP WITH
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TO TELL THE INTERNAL REVENUE
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SERVICE HOW TO TAX AMERICANS.
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>> Woman 2: OH! ARE YOU DEALING
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WITH A RECENT CODE?
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>> Man: A-A WHAT?
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>> Woman 2: RECENTLY FOR 19--
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FOR 2008 OR NINE OR WHAT?
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>> Man: I MEAN, I GUESS,
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LIKE, RIGHT NOW.
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>> ( extension ringing )
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>> Woman 3: HELLO,
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INTERNAL REVENUE.
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>> Man: YES, I WAS TRYING
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TO FIND OUT HOW MANY PAGES
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THE TAX CODE IS.
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>> Woman 3: I WOULDN'T KNOW.
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I HAVE NO IDEA.
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>> Man: WHAT ABOUT THE HEAD
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OF THE IRS, I MEAN,
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WOULD HE KNOW?
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>> Woman 3: WELL, I'M SURE
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HE WOULD, BUT YOU PROBABLY
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WON'T GET THROUGH TO HIM.
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>> Man: SO, IT'S KIND OF LIKE
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SENSITIVE INFORMATION
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THAT CAN'T BE--
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>> Woman 3: NO, IT'S NOT
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SENSITIVE, IT'S JUST THAT
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NONE OF US KNOW.
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WE HAVE NO WAY OF TELLING YOU
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HOW MANY PAGES
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ARE IN THE TAX CODE.
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WE'RE LOOKING AT VOLUMES
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AND VOLUMES AND VOLUMES
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AND VOLUMES!
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THE ONLY THING I CAN SAY
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IS MAYBE, UM...
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YOUR LIBRARY WOULD HAVE
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THAT INFORMATION,
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BECAUSE WE DON'T HAVE IT
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ON OUR COMPUTER.
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>> * APRIL 15th
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* HAS COME AGAIN
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* IT'S TIME TO MAIL
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* YOUR RETURNS IN
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* TO SEE WHAT YOU HAVE TO PAY
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* OR WHAT'S COMING BACK
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( fiddle plays )
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* WELL, IT'S ALL PENCILS
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* AND CALCULATORS
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* FORMS, RECEIPTS
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* AN HOUR LATER
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* UNCLE SAM WILL GET
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* THAT OLD CHECK
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* WILL IT BE ENOUGH TO PAY
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* FOR ALL THE STUFF
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* WE GOT TODAY?
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* TODAY WE'RE NOT THE SAME
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* AS WE ONCE WERE
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* WARS AND ROADS AND EDUCATION
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* EVERYTHING THAT MAKES
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* A NATION
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* CAN'T BE PAID FOR
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* WITH A BROKEN CODE
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* WE GOTTA FIX THE SYSTEM
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* OR GO HOME
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* FIX THE SYSTEM
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* OR GO HOME
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* WE'LL CUT TAXES DOWN
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* OR RAISE THEM HIGH
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* EITHER WAY THE FLAG WILL FLY
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* THAT'S THE MESS
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* THAT WE'RE DEALING WITH
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* THE FARE IS FLAT
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* THE FLAT IS FAIR
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* UNCLE SAM'S DOWN
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* TO HIS UNDERWEAR
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* WHILE EVERYONE
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* PREACHES THEIR NEW PLAN
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* WELL, I DON'T CARE
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* IF YOU WROTE A BOOK
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* I DO THINK CONGRESS IS
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* FULL OF CROOKS
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* THAT DON'T CHANGE A THING
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* FOR UNCLE SAM
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* GOTTA FIX THE SYSTEM
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* OR GO HOME
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* GOTTA FIX THE SYSTEM
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* OR GO HOME
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* TIERED TAX, FLAT TAX, V.A.T.
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* WHICH PLAN IS
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* THE BEST OF THESE?
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* I CAN'T EVEN READ MY W2
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* EX-TAX, GAS TAX
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* GONNA NEED SOME EX-LAX
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* BABY BOOMERS ALL RETIRE
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* WHILE OUR DEBT
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* IS CLIMBING HIGHER
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* HERE COME MY CONSUMPTION BASE
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>> * WHERE MY MONEY?
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>> * MISPLACED SOMEWHERE
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* IN THE CODE
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* GOTTA FIX THE SYSTEM
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* OR GO HOME
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* GOTTA FIX THE SYSTEM
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* OR GO HOME
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>> Thorndike: THE PROBLEM
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WITH TAXES AND DEMOCRACY
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IS THAT TAXES ARE COMPLICATED
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AND TEDIOUS AND UNPLEASANT.
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PEOPLE DON'T WANT
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TO TALK ABOUT THEM.
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THEY DON'T WANT TO READ
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ABOUT THEM.
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THEY WANT TO COMPLAIN ABOUT
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THEM, BUT ACTUALLY LEARNING
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SOMETHING ABOUT THEM
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IS NO FUN FOR ANYBODY,
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AND YET THEY ARE SO IMPORTANT
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TO THE WAY THE GOVERNMENT WORKS,
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TO THE WAY THE ECONOMY
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FUNCTIONS, WE CAN'T AFFORD
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TO NOT PAY ATTENTION
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TO WHAT KIND OF TAXES WE HAVE.
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>> TROOPS OF AN ALIEN SOURCE
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ARE APPROACHING FROM THE SKY.
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RADIO CONTACT HAS BEEN
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ATTEMPTED, BUT CANNOT
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BE ESTABLISHED.
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INSTRUCTIONS ARE TO PREPARE
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FOR AN ATTACK
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BY AN UNKNOWN ENEMY.
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>> THE ONE OBLIGATION
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THAT EVERY CITIZEN HAS
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IS TO PAY THEIR TAXES,
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AND THERE'S 175 MILLION
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TAXPAYERS WHO INTERACT
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IN THE TAX SYSTEM,
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SO THAT'S THE ONE THING
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THAT THE FEDERAL GOVERNMENT HAS
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THAT EVERYBODY HAS A STAKE IN.
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>> THERE'S NOT AN AMERICAN
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BREATHING TODAY THAT'S NOT
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AFFECTED BY THE TAX CODE.
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IT AFFECTS HIS OR HER JOB,
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IT AFFECTS WHETHER OR NOT
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YOU CAN AFFORD TO, UH,
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BUY A CAR,
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WHETHER YOUR JOB'S GONNA
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STILL BE THERE NEXT YEAR...
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EVERYTHING A PERSON
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IN THIS COUNTRY DOES
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IS AFFECTED BY THE TAX CODE.
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>> I WILL SUCCEED IN CREATING
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A PERFECT BEING.
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>> WHEN YOU THINK ABOUT HOW
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THE TAX LAWS AFFECT
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EVERY ASPECT OF OUR LIVES,
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JUST ABOUT-- HOUSING
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AND HEALTHCARE AND EDUCATION
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AND FAMILY AND DIVORCE
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AND MARRIAGE, CHILDCARE...
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IT GOES ON AND ON.
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RETIREMENT.
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THERE'S SUCH A CONNECTION
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BETWEEN THE WAY WE TAX,
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WHOM WE TAX, WHOM WE DON'T,
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& THE WAY GOVERNMENT FUNCTIONS.
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>> HEY, WHO DO YOU THINK
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YOU ARE, ANYWAY?
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>> ANSWER ME,
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OR I'LL DESTROY YOU!
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>> YOU'RE UP AGAINST
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THE FUNDAMENTAL LIMITATION
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THAT THE TAX CODE HAS BECOME
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A REAL MONSTROSITY
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IN TERMS OF THE COMPLEXITY
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OF THE BURDEN.
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>> Linder: WE HAVE CREATED
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A MONSTER...
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THAT SEEMS NOT TO BE ABLE
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TO BE CONTROLLED.
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>> ( screaming )
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>> YOU ADD IN ALL OF
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THE CRAZY POLITICAL
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ACTION COMMITTEES,
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AND EVERYBODY HAS AN AGENDA,
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AND THE LOBBYISTS,
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AND, YOU KNOW, YOU HAVE A MESS.
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>> ( screaming )
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>> IN THE LAST 20 YEARS,
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I THINK WE'VE AMENDED THE THING
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14,000 TIMES, ADDED
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THREE MILLION NEW WORDS.
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>> AAH! JULIE! AAH!
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>> EVEN THOSE WHO WOULD LIKE
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TO MAKE IT EFFICIENT
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AND MAKE IT WORK,
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IT'S STILL A MONSTER.
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NOBODY UNDERSTANDS IT.
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>> EVERY TIME YOU ADD
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A NEW PROVISION--
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AND THERE'S BEEN 14,000 NEW ONES
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IN THE LAST 20 YEARS--
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YOU HAVE TO PUT SOMETHING
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IN A FORM TO COVER THAT.
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>> Shaviro: THE AVERAGE AMERICAN
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SPENDS, I THINK, 57 HOURS
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WORKING ON THEIR TAXES.
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MANY OF THEM HIRE ACCOUNTANTS
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BECAUSE IT'S BECOME
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SO HORRIBLY COMPLICATED.
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>> Man: PERHAPS THE 1st QUESTION
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YOU SHOULD ASK YOURSELF IS,
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"DO I REALLY ENJOY
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DOING FIGURES?"
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IF YOU HAVE A DISTASTE
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FOR MATHEMATICS,
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IS IS NOT THE WORK FOR YOU.
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>> IT IS SO COMPLICATED,
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YOU HAVE NO IDEA
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WHETHER OR NOT
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YOU'VE DONE IT RIGHT OR NOT.
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>> TAXES. BUDGETS.
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PAPERWORK POLLUTION.
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THERE'S JUST NO GETTING
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AROUND IT.
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>> WHETHER IT'S AN INDIVIDUAL
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OR A SMALL BUSINESS OPERATOR,
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HE CAN CALL THE IRS
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THREE DIFFERENT TIMES
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AND GET THREE ANSWERS
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ABOUT THE SAME QUESTION.
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IT'S SO COMPLICATED
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THE IRS DOESN'T UNDERSTAND IT.
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>> WE WANT THE TAXPAYERS TO KNOW
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THAT WE'RE HERE TO HELP.
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AFTER ALL, THEY ARE THE ONES
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THAT WE REALLY WORK FOR.
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>> THE IRS, CONTRARY
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TO WHAT MOST PEOPLE THINK,
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REALLY HAS NOTHING TO SAY
271
00:07:45,633 --> 00:07:46,800
ABOUT WHAT THE TAX CODE IS.
272
00:07:46,800 --> 00:07:48,502
IT'S JUST GIVEN THE TAX CODE
273
00:07:48,502 --> 00:07:49,503
THAT'S PASSED BY THE CONGRESS
274
00:07:49,503 --> 00:07:50,504
AND THE ADMINISTRATION.
275
00:07:50,504 --> 00:07:51,171
IT'S THEN ADMINISTERED.
276
00:07:51,171 --> 00:07:52,640
>> NONE OF US EVER HESITATES
277
00:07:52,640 --> 00:07:53,741
TO CRITICIZE CONGRESS
278
00:07:53,741 --> 00:07:54,842
AT EVERY OPPORTUNITY,
279
00:07:54,842 --> 00:07:56,610
BUT HOW MANY EVER STOP TO THINK
280
00:07:56,610 --> 00:07:57,845
ABOUT THE BROAD POWERS
281
00:07:57,845 --> 00:07:59,513
OF CONGRESS AND HOW THESE POWERS
282
00:07:59,513 --> 00:08:01,148
AFFECT EVERY ONE OF US?
283
00:08:01,148 --> 00:08:02,616
>> THE WAY THE CONGRESS
284
00:08:02,616 --> 00:08:03,884
OF THE UNITED STATES WORKS,
285
00:08:03,884 --> 00:08:05,018
THINGS HAVE TO BE
286
00:08:05,018 --> 00:08:07,788
IN A JUST TOTAL...
287
00:08:07,788 --> 00:08:09,523
SMACK-AGAINST-THE-WALL CRISIS
288
00:08:09,523 --> 00:08:11,659
FOR ANYTHING TO GET FIXED.
289
00:08:11,659 --> 00:08:12,660
>> ( screams )
290
00:08:12,660 --> 00:08:13,661
>> THE TAX SYSTEM IS
291
00:08:13,661 --> 00:08:14,862
SO COMPLICATED THAT A LOT
292
00:08:14,862 --> 00:08:16,129
OF PEOPLE FEEL LIKE THEY'RE
293
00:08:16,129 --> 00:08:17,665
NOT GETTING THEIR FAIR SHARE
294
00:08:17,665 --> 00:08:18,932
OF ALL THE TAX BREAKS.
295
00:08:18,932 --> 00:08:20,167
>> ALMOST EVERYBODY FEELS
296
00:08:20,167 --> 00:08:21,168
THAT THE OTHER GUY
297
00:08:21,168 --> 00:08:23,203
IS ESCAPING TAXES.
298
00:08:23,203 --> 00:08:25,072
>> AND AS THEY BELIEVE
299
00:08:25,072 --> 00:08:27,074
INCREASINGLY THAT IT'S NOT FAIR,
300
00:08:27,074 --> 00:08:28,075
THAT REFLECTS ON ALL
301
00:08:28,075 --> 00:08:29,309
OF GOVERNMENT.
302
00:08:29,309 --> 00:08:30,544
>> ONE RESULT IS
303
00:08:30,544 --> 00:08:32,613
THE APRIL 15th PHENOMENON.
304
00:08:32,613 --> 00:08:34,214
THIS ALIEN FORCE, YOU KNOW,
305
00:08:34,214 --> 00:08:35,916
FROM MARS OR SOMETHING,
306
00:08:35,916 --> 00:08:37,685
IS TAKING AWAY
307
00:08:37,685 --> 00:08:38,952
YOUR HARD-EARNED MONEY,
308
00:08:38,952 --> 00:08:40,220
NOT "I'M PARTICIPATING
309
00:08:40,220 --> 00:08:41,221
IN A COMMUNITY
310
00:08:41,221 --> 00:08:43,624
WHERE WE MADE COMMON DECISIONS,
311
00:08:43,624 --> 00:08:45,793
AND I'M GLAD TO BE ABLE
312
00:08:45,793 --> 00:08:46,827
TO PARTICIPATE IN IT,"
313
00:08:46,827 --> 00:08:47,828
WHICH IS THE WAY
314
00:08:47,828 --> 00:08:49,096
A HEALTHY SOCIETY WOULD WORK.
315
00:08:49,096 --> 00:08:50,097
>> I DON'T THINK IT'S
316
00:08:50,097 --> 00:08:51,198
AN EXAGGERATION TO SAY THAT
317
00:08:51,198 --> 00:08:52,600
OUR DEMOCRACY AS WE'VE KNOWN IT
318
00:08:52,600 --> 00:08:53,601
IS AT STAKE.
319
00:08:53,601 --> 00:08:54,602
>> WE LIVE LIKE PARTS
320
00:08:54,602 --> 00:08:55,603
OF A MACHINE.
321
00:08:55,603 --> 00:08:56,804
WE DON'T KNOW OUR FATHERS
322
00:08:56,804 --> 00:08:57,938
OR MOTHERS, WE'RE RAISED
323
00:08:57,938 --> 00:08:58,939
IN CUBICLES, THE SICK
324
00:08:58,939 --> 00:08:59,973
AND THE OLD ARE PUT TO DEATH...
325
00:08:59,973 --> 00:09:01,975
>> IT IS THE ONE AND ONLY WAY
326
00:09:01,975 --> 00:09:04,144
TO MAINTAIN THE SUPREME RACE.
327
00:09:04,144 --> 00:09:05,212
HAVE YOU FORGOTTEN--
328
00:09:05,212 --> 00:09:08,048
>> OUR PEOPLE HAVE FORGOTTEN.
329
00:09:08,048 --> 00:09:10,250
THEY HAVE BEEN MADE TO FORGET.
330
00:09:10,250 --> 00:09:11,351
>> IF WE BELIEVE THAT WE
331
00:09:11,351 --> 00:09:12,352
OUGHT TO HAVE, UH,
332
00:09:12,352 --> 00:09:14,688
FEDERAL ASSISTANCE FOR,
333
00:09:14,688 --> 00:09:16,123
NOT JUST HURRICANES AND FLOODS,
334
00:09:16,123 --> 00:09:17,758
YOU KNOW, BUT HIGHWAYS
335
00:09:17,758 --> 00:09:19,760
AND OUR COURT SYSTEM
336
00:09:19,760 --> 00:09:21,228
AND POLICE ON THE STREET
337
00:09:21,228 --> 00:09:22,830
AND OUR EDUCATION SYSTEM
338
00:09:22,830 --> 00:09:23,864
AND OUR HEALTH SYSTEM
339
00:09:23,864 --> 00:09:24,865
AND THE FOOD
340
00:09:24,865 --> 00:09:25,999
AND DRUG ADMINISTRATION...
341
00:09:25,999 --> 00:09:27,067
IF WE WANT A SECURITIES
342
00:09:27,067 --> 00:09:28,135
AND EXCHANGE COMMISSION,
343
00:09:28,135 --> 00:09:29,136
IF WE WANT A FEDERAL
344
00:09:29,136 --> 00:09:30,137
TRADE COMMISSION,
345
00:09:30,137 --> 00:09:31,371
IF WE WANT TO HAVE THE THINGS
346
00:09:31,371 --> 00:09:32,640
THAT WE'VE GROWN USED TO,
347
00:09:32,640 --> 00:09:33,907
WHICH MAY BE EXCESSIVE NOW.
348
00:09:33,907 --> 00:09:35,142
I MEAN, SOME OF THEM MAY BE,
349
00:09:35,142 --> 00:09:36,677
AND OTHERS WE WANT TO LOOK AT.
350
00:09:36,677 --> 00:09:37,911
BUT IF WE WANT GOVERNMENT,
351
00:09:37,911 --> 00:09:38,979
FEDERAL GOVERNMENT,
352
00:09:38,979 --> 00:09:40,948
TO LOOK AFTER THE PUBLIC
353
00:09:40,948 --> 00:09:41,949
IN LOTS OF WAYS,
354
00:09:41,949 --> 00:09:42,950
'CAUSE SOCIETY IS
355
00:09:42,950 --> 00:09:44,284
SO COMPLICATED, WE WILL NOT
356
00:09:44,284 --> 00:09:46,119
BE ABLE TO AFFORD THAT.
357
00:09:46,119 --> 00:09:47,254
>> THE CURRENT TAX SYSTEM
358
00:09:47,254 --> 00:09:48,789
JUST ISN'T UP TO THAT CHALLENGE.
359
00:09:48,789 --> 00:09:50,157
WE'RE GONNA NEED AN EFFICIENT
360
00:09:50,157 --> 00:09:51,291
WAY OF RAISING REVENUE,
361
00:09:51,291 --> 00:09:52,292
AND ONE THAT IS FAIR
362
00:09:52,292 --> 00:09:53,293
AND THAT PEOPLE
363
00:09:53,293 --> 00:09:54,294
PERCEIVE TO BE FAIR.
364
00:09:54,294 --> 00:09:55,295
>> WE FACE PROBLEMS
365
00:09:55,295 --> 00:09:56,730
IN THIS COUNTRY RIGHT NOW,
366
00:09:56,730 --> 00:09:57,731
FISCAL PROBLEMS
367
00:09:57,731 --> 00:09:58,732
OVER THE LONG TERM
368
00:09:58,732 --> 00:09:59,900
THAT ARE SO SERIOUS
369
00:09:59,900 --> 00:10:01,001
THAT WE SHOULD ALL FEAR
370
00:10:01,001 --> 00:10:02,369
FOR THE SAFETY OF OUR CHILDREN
371
00:10:02,369 --> 00:10:03,937
DOWN THE ROAD.
372
00:10:03,937 --> 00:10:05,272
AMERICANS CANNOT IGNORE
373
00:10:05,272 --> 00:10:06,740
THAT THEY'RE GONNA HAVE
374
00:10:06,740 --> 00:10:07,941
TO JUST COWBOY UP
375
00:10:07,941 --> 00:10:10,043
AND DEAL WITH THIS NASTY,
376
00:10:10,043 --> 00:10:12,646
BORING, TEDIOUS TOPIC,
377
00:10:12,646 --> 00:10:14,648
UH, BECAUSE IT'S JUST TOO--
378
00:10:14,648 --> 00:10:16,984
TOO IMPORTANT TO IGNORE.
379
00:11:06,734 --> 00:11:08,101
OBJECTIONS TO TAXATION
380
00:11:08,101 --> 00:11:09,102
ARE FRAMED IN TERMS
381
00:11:09,102 --> 00:11:11,038
OF WHY THIS IS UNFAIR TO ME,
382
00:11:11,038 --> 00:11:12,039
WHY THIS IS UNFAIR
383
00:11:12,039 --> 00:11:13,040
TO PEOPLE LIKE ME,
384
00:11:13,040 --> 00:11:14,274
WHY IT TREATS OTHER PEOPLE
385
00:11:14,274 --> 00:11:16,143
DIFFERENTLY THAN IT TREATS ME,
386
00:11:16,143 --> 00:11:18,245
AND I THINK THAT THAT OUTRAGE
387
00:11:18,245 --> 00:11:19,246
THAT CAN DEVELOP
388
00:11:19,246 --> 00:11:20,480
AROUND SPECIAL TREATMENT
389
00:11:20,480 --> 00:11:21,982
AND FAVORITISM, UH,
390
00:11:21,982 --> 00:11:23,851
IS A KEY TO UNDERSTANDING
391
00:11:23,851 --> 00:11:26,119
AMERICAN TAX HISTORY.
392
00:11:30,958 --> 00:11:31,959
THE U.S. WAS BORN
393
00:11:31,959 --> 00:11:32,960
OF A TAX REVOLT,
394
00:11:32,960 --> 00:11:33,961
BUT IT WAS ACTUALLY
395
00:11:33,961 --> 00:11:35,896
NOT A REVOLT AGAINST HIGH TAXES.
396
00:11:35,896 --> 00:11:36,897
THE BOSTON TEA PARTY
397
00:11:36,897 --> 00:11:37,898
WAS A REVOLT AGAINST
398
00:11:37,898 --> 00:11:38,899
TAX LOOPHOLES.
399
00:11:38,899 --> 00:11:40,968
THE BRITISH HAD PASSED A LAW
400
00:11:40,968 --> 00:11:42,002
THAT GRANTED CERTAIN
401
00:11:42,002 --> 00:11:43,003
SPECIAL FAVORS
402
00:11:43,003 --> 00:11:44,004
TO A FEW MERCHANTS
403
00:11:44,004 --> 00:11:45,272
WHO WERE SELLING TEA,
404
00:11:45,272 --> 00:11:46,406
AND AMERICAN MERCHANTS
405
00:11:46,406 --> 00:11:47,507
RESENTED THE MONOPOLY
406
00:11:47,507 --> 00:11:48,942
THAT HAD BEEN GRANTED HERE
407
00:11:48,942 --> 00:11:50,043
AND THE TAX EXEMPTIONS
408
00:11:50,043 --> 00:11:51,411
THAT HAD BEEN GRANTED,
409
00:11:51,411 --> 00:11:52,445
AND THEIR OBJECTIONS
410
00:11:52,445 --> 00:11:53,446
TO THE BRITISH TAX
411
00:11:53,446 --> 00:11:54,447
WERE REALLY DIRECTED
412
00:11:54,447 --> 00:11:55,448
AT THE LOOPHOLES
413
00:11:55,448 --> 00:11:56,884
THAT WERE A PART OF THAT TAX,
414
00:11:56,884 --> 00:11:57,885
NOT AT THE TAX ITSELF.
415
00:11:57,885 --> 00:11:59,519
IT'S IMPORTANT BECAUSE IT IS
416
00:11:59,519 --> 00:12:01,088
AMERICANS' FIRST EXPERIENCE
417
00:12:01,088 --> 00:12:03,290
WITH REALLY, UH, THROWING DOWN--
418
00:12:03,290 --> 00:12:05,225
WELL, THROWING THE TEA
419
00:12:05,225 --> 00:12:06,226
INTO THE HARBOR--
420
00:12:06,226 --> 00:12:07,227
BUT SIMPLY TO SAY
421
00:12:07,227 --> 00:12:08,395
WE ARE NOT GONNA STAND FOR
422
00:12:08,395 --> 00:12:09,797
THIS KIND OF SPECIAL TREATMENT.
423
00:12:09,797 --> 00:12:10,864
WE ARE NOT GONNA STAND
424
00:12:10,864 --> 00:12:12,099
FOR TAXES THAT DON'T TREAT
425
00:12:12,099 --> 00:12:13,300
EVERYONE EQUALLY.
426
00:12:13,300 --> 00:12:14,835
THAT'S THE KIND OF TAX REVOLT
427
00:12:14,835 --> 00:12:16,169
IT WAS, AND THERE ARE MORE
428
00:12:16,169 --> 00:12:17,237
TAX REVOLTS LIKE THAT
429
00:12:17,237 --> 00:12:18,238
OVER THE COURSE
430
00:12:18,238 --> 00:12:19,272
OF AMERICAN HISTORY.
431
00:12:19,272 --> 00:12:21,942
>> ( cannon fires )
432
00:12:21,942 --> 00:12:23,176
>> MANY OF THE ARGUMENTS
433
00:12:23,176 --> 00:12:24,177
OVER TAXATION
434
00:12:24,177 --> 00:12:25,278
IN THE EARLY REPUBLIC,
435
00:12:25,278 --> 00:12:26,279
IN THE EARLY YEARS
436
00:12:26,279 --> 00:12:27,414
AFTER THE CONSTITUTION
437
00:12:27,414 --> 00:12:28,381
WAS RATIFIED,
438
00:12:28,381 --> 00:12:29,416
WERE ABOUT TAXATION.
439
00:12:29,416 --> 00:12:32,019
THOMAS JEFFERSON'S PARTY
440
00:12:32,019 --> 00:12:33,120
GENERALLY BELIEVED
441
00:12:33,120 --> 00:12:34,454
THAT THE FEDERAL GOVERNMENT
442
00:12:34,454 --> 00:12:35,555
SHOULD CONFINE ITSELF
443
00:12:35,555 --> 00:12:37,090
TO IMPORT DUTIES
444
00:12:37,090 --> 00:12:38,091
AND FUND ITSELF
445
00:12:38,091 --> 00:12:39,392
THROUGH A TARIFF.
446
00:12:39,392 --> 00:12:43,063
THE FEDERALISTS INSISTED
447
00:12:43,063 --> 00:12:44,264
ON USING INTERNAL TAXES,
448
00:12:44,264 --> 00:12:46,333
AS WELL, AND THAT PRODUCED
449
00:12:46,333 --> 00:12:47,801
QUITE A BIT OF CONFLICT,
450
00:12:47,801 --> 00:12:50,070
INCLUDING THE WHISKEY REBELLION,
451
00:12:50,070 --> 00:12:51,071
AN INTERNAL TAX
452
00:12:51,071 --> 00:12:53,340
MORE POORLY TOLERATED
453
00:12:53,340 --> 00:12:54,441
IN THIS PERIOD OF TIME.
454
00:12:54,441 --> 00:12:55,843
IT OUTRAGED FARMERS,
455
00:12:55,843 --> 00:12:57,577
WHO WERE DEPENDING ON--
456
00:12:57,577 --> 00:12:59,079
ON THE PRODUCTION OF WHISKEY
457
00:12:59,079 --> 00:13:00,080
TO MAKE THEIR LIVING
458
00:13:00,080 --> 00:13:01,882
AND WHO FELT THAT IT WAS UNFAIR
459
00:13:01,882 --> 00:13:03,583
TO IMPOSE A TAX ON THEIR PRODUCT
460
00:13:03,583 --> 00:13:05,018
SPECIFICALLY.
461
00:13:05,018 --> 00:13:06,453
IT POSED A SIGNIFICANT THREAT
462
00:13:06,453 --> 00:13:07,921
TO THE FEDERAL GOVERNMENT,
463
00:13:07,921 --> 00:13:09,156
BUT IN MANY RESPECTS GAVE
464
00:13:09,156 --> 00:13:10,290
THE FEDERAL GOVERNMENT
465
00:13:10,290 --> 00:13:11,892
AN OPPORTUNITY TO DEMONSTRATE
466
00:13:11,892 --> 00:13:12,893
FOR THE FIRST TIME
467
00:13:12,893 --> 00:13:13,894
THAT IT WAS ABLE
468
00:13:13,894 --> 00:13:14,995
TO TAKE CARE OF ITSELF.
469
00:13:14,995 --> 00:13:16,263
THE FEDERAL GOVERNMENT SENT
470
00:13:16,263 --> 00:13:17,998
TROOPS INTO WESTERN PENNSYLVANIA
471
00:13:17,998 --> 00:13:19,266
AND QUELLED THE REBELLION
472
00:13:19,266 --> 00:13:21,001
AND ESTABLISHED
473
00:13:21,001 --> 00:13:22,335
THAT THE FEDERAL GOVERNMENT
474
00:13:22,335 --> 00:13:23,971
NOT ONLY HAD THE LEGAL AUTHORITY
475
00:13:23,971 --> 00:13:25,105
TO IMPOSE THESE TAXES,
476
00:13:25,105 --> 00:13:26,139
BUT ALSO HAD THE POWER
477
00:13:26,139 --> 00:13:28,108
TO IMPOSE THEM, AS WELL.
478
00:13:28,108 --> 00:13:31,544
>> ** ( "Yankee Doodle Dandy" )
479
00:13:35,849 --> 00:13:36,984
>> Fox: DURING THE CIVIL WAR,
480
00:13:36,984 --> 00:13:38,852
LINCOLN KNEW THAT THE GOVERNMENT
481
00:13:38,852 --> 00:13:39,853
NEEDED REVENUE,
482
00:13:39,853 --> 00:13:41,154
AND SO THEY ACTUALLY ADOPTED
483
00:13:41,154 --> 00:13:42,555
THE FIRST FEDERAL INCOME TAX.
484
00:13:42,555 --> 00:13:44,091
>> ONE OF THE STRIKING THINGS
485
00:13:44,091 --> 00:13:45,392
ABOUT THIS WARTIME TAX
486
00:13:45,392 --> 00:13:46,559
WAS THAT IT WAS CONDUCTED
487
00:13:46,559 --> 00:13:48,261
IN PUBLIC, AND ANYONE
488
00:13:48,261 --> 00:13:49,529
COULD GO AND ASK TO SEE THEM.
489
00:13:49,529 --> 00:13:50,931
THEY COULD GO TO THE LOCAL
490
00:13:50,931 --> 00:13:52,199
COLLECTOR'S OFFICE AND SAY,
491
00:13:52,199 --> 00:13:53,200
"I WANT TO SEE
492
00:13:53,200 --> 00:13:54,234
MY NEIGHBOR'S TAX RETURN."
493
00:13:54,234 --> 00:13:55,502
THIS WAS ABOUT AS UNPOPULAR
494
00:13:55,502 --> 00:13:57,437
AS YOU WOULD EXPECT IT TO BE.
495
00:13:57,437 --> 00:13:58,972
PEOPLE REALLY FELT LIKE THIS
496
00:13:58,972 --> 00:13:59,973
WAS AN INVASION
497
00:13:59,973 --> 00:14:00,974
ON THEIR PRIVACY.
498
00:14:00,974 --> 00:14:02,109
THEY DIDN'T WANT PEOPLE
499
00:14:02,109 --> 00:14:03,110
PAWING AROUND
500
00:14:03,110 --> 00:14:04,377
IN THEIR PERSONAL AFFAIRS,
501
00:14:04,377 --> 00:14:05,578
BUT THERE WERE MANY PEOPLE
502
00:14:05,578 --> 00:14:06,579
AT THE TIME, INCLUDING
503
00:14:06,579 --> 00:14:07,580
MANY POLITICAL LEADERS,
504
00:14:07,580 --> 00:14:08,648
WHO FELT THAT THIS WAS
505
00:14:08,648 --> 00:14:09,649
A VITAL COMPONENT
506
00:14:09,649 --> 00:14:10,650
OF THE INCOME TAX,
507
00:14:10,650 --> 00:14:11,651
BECAUSE IT ENSURED
508
00:14:11,651 --> 00:14:12,953
BETTER COMPLIANCE.
509
00:14:12,953 --> 00:14:14,154
IF YOUR NEIGHBORS COULD GO IN
510
00:14:14,154 --> 00:14:15,388
AND LOOK AT YOUR TAX RETURNS
511
00:14:15,388 --> 00:14:16,523
AND SEE THAT YOU WEREN'T
512
00:14:16,523 --> 00:14:18,058
REPORTING A REASONABLE AMOUNT
513
00:14:18,058 --> 00:14:19,292
OF MONEY, THEY COULD REPORT
514
00:14:19,292 --> 00:14:20,560
YOU TO THE TAX COLLECTORS,
515
00:14:20,560 --> 00:14:21,561
AND THEY MIGHT GO
516
00:14:21,561 --> 00:14:23,196
AND INVESTIGATE,
517
00:14:23,196 --> 00:14:26,433
WHICH THEY HAD THE RIGHT TO DO.
518
00:14:26,433 --> 00:14:28,068
THE SOUTH WAS MUCH MORE
519
00:14:28,068 --> 00:14:29,169
RELUCTANT TO IMPOSE
520
00:14:29,169 --> 00:14:31,138
HEAVY TAXES, AND RELIED
521
00:14:31,138 --> 00:14:32,272
MUCH MORE THAN THE NORTH
522
00:14:32,272 --> 00:14:34,207
ON LOANS, ON PRINTING
523
00:14:34,207 --> 00:14:35,909
PAPER MONEY...
524
00:14:35,909 --> 00:14:38,278
ALSO ON JUST CONFISCATING
525
00:14:38,278 --> 00:14:39,379
GOODS THAT THEY NEEDED
526
00:14:39,379 --> 00:14:40,380
FOR THEIR--
527
00:14:40,380 --> 00:14:41,448
FOR FIGHTING THE WAR,
528
00:14:41,448 --> 00:14:42,449
AND THE RESULTS WERE
529
00:14:42,449 --> 00:14:43,616
FINANCIALLY DISASTROUS
530
00:14:43,616 --> 00:14:44,684
FOR THE CONFEDERACY.
531
00:14:44,684 --> 00:14:46,286
THEY NEVER WERE ABLE TO DEVELOP
532
00:14:46,286 --> 00:14:47,287
A ROBUST TAX SYSTEM,
533
00:14:47,287 --> 00:14:48,288
AND I THINK, IN PART,
534
00:14:48,288 --> 00:14:49,689
THIS IS A-- WAS A CULTURAL
535
00:14:49,689 --> 00:14:51,624
RESISTANCE TO TAX POLICY,
536
00:14:51,624 --> 00:14:53,026
ESPECIALLY IN THE EARLY YEARS
537
00:14:53,026 --> 00:14:54,027
OF THE WAR.
538
00:14:54,027 --> 00:14:55,028
>> WELL, NO ONE LOVED
539
00:14:55,028 --> 00:14:56,429
THE INCOME TAX IN THE CIVIL WAR.
540
00:14:56,429 --> 00:14:57,430
IT WAS A NECESSITY,
541
00:14:57,430 --> 00:14:59,266
LIKE ALL TAXES ARE,
542
00:14:59,266 --> 00:15:01,935
BUT IT WAS TREMENDOUSLY HELPFUL
543
00:15:01,935 --> 00:15:04,004
IN ENABLING THE UNION
544
00:15:04,004 --> 00:15:05,372
TO PAY FOR THE WAR
545
00:15:05,372 --> 00:15:08,141
WITHOUT ENTIRELY RESORTING
546
00:15:08,141 --> 00:15:09,609
TO BORROWING, AND YOU COULD
547
00:15:09,609 --> 00:15:11,211
ARGUE THAT THE INCOME TAX
548
00:15:11,211 --> 00:15:12,479
REALLY HELPED THE UNION
549
00:15:12,479 --> 00:15:14,347
WIN THE WAR.
550
00:15:14,347 --> 00:15:16,383
>> SURRENDER...
551
00:15:16,383 --> 00:15:20,053
MY POOR ARMY.
552
00:15:20,053 --> 00:15:21,154
>> Weisman: BUT AS SOON
553
00:15:21,154 --> 00:15:22,155
AS THE WAR WAS OVER,
554
00:15:22,155 --> 00:15:23,523
EVERYONE WANTED TO REPEAL IT.
555
00:15:23,523 --> 00:15:26,359
IT WAS A, UH, DISTASTEFUL TAX,
556
00:15:26,359 --> 00:15:27,961
AND THEY REPEALED IT
557
00:15:27,961 --> 00:15:29,596
STEP BY STEP.
558
00:15:29,596 --> 00:15:30,597
BUT AS THEY DID SO,
559
00:15:30,597 --> 00:15:32,432
STARTING IN THE 1860s
560
00:15:32,432 --> 00:15:34,467
AND THEN THE 1870s,
561
00:15:34,467 --> 00:15:36,203
UH, THERE WERE WARNINGS,
562
00:15:36,203 --> 00:15:37,370
EVEN FROM REPUBLICANS,
563
00:15:37,370 --> 00:15:39,372
WHO SAID, "THIS TAX
564
00:15:39,372 --> 00:15:40,373
WILL COME BACK.
565
00:15:40,373 --> 00:15:41,474
WE'LL HAVE TO TURN BACK
566
00:15:41,474 --> 00:15:42,475
TO BACK TO IT AGAIN,
567
00:15:42,475 --> 00:15:43,743
EITHER BECAUSE OF A CRISIS,
568
00:15:43,743 --> 00:15:46,980
UH, IN OUR-- A MILITARY CRISIS,
569
00:15:46,980 --> 00:15:48,315
A WAR, OR BECAUSE OF
570
00:15:48,315 --> 00:15:49,482
AN ECONOMIC CRISIS,
571
00:15:49,482 --> 00:15:50,650
AND THIS IS THE TAX
572
00:15:50,650 --> 00:15:52,752
THAT AMERICANS ARE GONNA HAVE
573
00:15:52,752 --> 00:15:54,687
TO GET USED TO IN THE FUTURE."
574
00:15:54,687 --> 00:15:58,391
>> ( out-of-tune piano playing )
575
00:16:01,128 --> 00:16:02,129
>> WHAT HAPPENED
576
00:16:02,129 --> 00:16:03,363
AT THE TURN OF THE CENTURY
577
00:16:03,363 --> 00:16:04,364
WAS THE EMERGENCE
578
00:16:04,364 --> 00:16:05,365
OF A MIDDLE CLASS
579
00:16:05,365 --> 00:16:07,200
AND AN UPPER MIDDLE CLASS
580
00:16:07,200 --> 00:16:08,401
OF PROFESSIONALS.
581
00:16:08,401 --> 00:16:10,370
THE MAN WHO SYMBOLIZED THEM
582
00:16:10,370 --> 00:16:12,439
WAS, UH, TEDDY ROOSEVELT,
583
00:16:12,439 --> 00:16:15,275
AND WHO EMBRACED THE INCOME TAX,
584
00:16:15,275 --> 00:16:16,276
ALTHOUGH HE DIDN'T
585
00:16:16,276 --> 00:16:17,677
GET IT PASSED, BUT HE EMBRACED
586
00:16:17,677 --> 00:16:20,247
IT DURING HIS PRESIDENCY.
587
00:16:20,247 --> 00:16:21,348
>> Thorndike: THERE IS
588
00:16:21,348 --> 00:16:23,183
A CONTINUAL AND FAIRLY SPIRITED
589
00:16:23,183 --> 00:16:24,784
DEBATE ABOUT HOW TO REINTRODUCE
590
00:16:24,784 --> 00:16:26,019
THE INCOME TAX IN A WAY
591
00:16:26,019 --> 00:16:27,020
THAT WOULD PASS
592
00:16:27,020 --> 00:16:28,155
CONSTITUTIONAL MUSTER
593
00:16:28,155 --> 00:16:30,190
AND THAT WOULD ALLOW LAWMAKERS
594
00:16:30,190 --> 00:16:31,491
TO REDUCE THEIR DEPENDENCE
595
00:16:31,491 --> 00:16:32,492
ON TARIFF DUTIES
596
00:16:32,492 --> 00:16:33,493
AND REPLACE THEM
597
00:16:33,493 --> 00:16:35,362
WITH SOMETHING MORE PROGRESSIVE.
598
00:16:35,362 --> 00:16:36,563
>> BY 1913, WE HAD
599
00:16:36,563 --> 00:16:38,731
THE 16th AMENDMENT,
600
00:16:38,731 --> 00:16:39,732
WHICH WAS NECESSARY
601
00:16:39,732 --> 00:16:41,268
BECAUSE OF THE SUPREME COURT
602
00:16:41,268 --> 00:16:42,269
DECISION THAT SAID
603
00:16:42,269 --> 00:16:44,204
THAT, UH, YOU COULDN'T HAVE
604
00:16:44,204 --> 00:16:45,705
THE INCOME TAX CONSTITUTIONALLY
605
00:16:45,705 --> 00:16:47,374
WITHOUT THE AMENDMENT.
606
00:16:47,374 --> 00:16:48,375
>> Thorndike: RIGHT AROUND
607
00:16:48,375 --> 00:16:49,376
THE SAME TIME THAT
608
00:16:49,376 --> 00:16:51,111
WOODROW WILSON BECAME PRESIDENT,
609
00:16:51,111 --> 00:16:52,345
THE INCOME TAX WAS PART
610
00:16:52,345 --> 00:16:54,081
OF THE REFORMS THAT HE THEN
611
00:16:54,081 --> 00:16:55,082
ENACTED INTO LAW
612
00:16:55,082 --> 00:16:56,483
THROUGH STATUTE.
613
00:16:56,483 --> 00:16:58,085
SO, YOU CREATE THIS INCOME TAX
614
00:16:58,085 --> 00:17:00,253
IN 1913, IT, UH, BARELY GETS
615
00:17:00,253 --> 00:17:01,788
ITS FEET ON THE GROUND
616
00:17:01,788 --> 00:17:03,590
BEFORE WORLD WAR ONE,
617
00:17:03,590 --> 00:17:05,592
ONCE AGAIN, DISRUPTS
618
00:17:05,592 --> 00:17:06,593
TARIFF REVENUES,
619
00:17:06,593 --> 00:17:07,827
CREATES A REVENUE CRISIS
620
00:17:07,827 --> 00:17:09,396
FOR THE FEDERAL GOVERNMENT,
621
00:17:09,396 --> 00:17:10,597
AND CONGRESS TURNS
622
00:17:10,597 --> 00:17:11,598
TO THE INCOME TAX
623
00:17:11,598 --> 00:17:12,599
AS THE MOST LIKELY
624
00:17:12,599 --> 00:17:13,633
REPLACEMENT FOR THIS
625
00:17:13,633 --> 00:17:15,335
IN THE TIME OF WAR.
626
00:17:15,335 --> 00:17:17,670
>> Man: THREE THOUSAND MILES
627
00:17:17,670 --> 00:17:19,839
FROM HOME, AN AMERICAN ARMY
628
00:17:19,839 --> 00:17:21,741
IS FIGHTING FOR YOU.
629
00:17:21,741 --> 00:17:24,577
EVERYTHING YOU HOLD WORTHWHILE
630
00:17:24,577 --> 00:17:25,578
IS AT STAKE.
631
00:17:25,578 --> 00:17:27,080
>> Fox: DURING WORLD WAR ONE,
632
00:17:27,080 --> 00:17:28,581
THE TOP TAX RATE MOVES
633
00:17:28,581 --> 00:17:32,152
FROM 7% TO 77%,
634
00:17:32,152 --> 00:17:35,088
AND SUDDENLY TAXES BECOME
635
00:17:35,088 --> 00:17:36,456
A HUGE CONCERN OF
636
00:17:36,456 --> 00:17:37,790
A LOT OF PEOPLE.
637
00:17:37,790 --> 00:17:39,559
PEOPLE CAME TO CONGRESS--
638
00:17:39,559 --> 00:17:40,627
THE FIRST DEDUCTION,
639
00:17:40,627 --> 00:17:41,661
THE FIRST ONE THAT WAS
640
00:17:41,661 --> 00:17:43,396
REALLY FOCUSED ON THE TAX LAWS,
641
00:17:43,396 --> 00:17:44,797
WAS THE CHARITABLE DEDUCTION,
642
00:17:44,797 --> 00:17:45,798
AND THAT'S BECAUSE
643
00:17:45,798 --> 00:17:47,334
PRESIDENTS OF UNIVERSITIES
644
00:17:47,334 --> 00:17:48,635
AND COLLEGE CAME TO CONGRESS
645
00:17:48,635 --> 00:17:50,103
AND SAID, "LOOK, WE'RE NOT
646
00:17:50,103 --> 00:17:51,171
GETTING CONTRIBUTIONS.
647
00:17:51,171 --> 00:17:52,305
YOU'RE TAKING 77%
648
00:17:52,305 --> 00:17:53,306
OF THE TOP DOLLARS
649
00:17:53,306 --> 00:17:54,407
OF RICH PEOPLE."
650
00:17:54,407 --> 00:17:55,542
SO CONGRESS SAID, WELL,
651
00:17:55,542 --> 00:17:56,543
WE'LL GIVE YOU
652
00:17:56,543 --> 00:17:57,710
A CHARITABLE DEDUCTION,
653
00:17:57,710 --> 00:18:00,113
AND VERY MUCH, THAT'S THE WAY
654
00:18:00,113 --> 00:18:01,448
THE LAWS EVOLVED.
655
00:18:01,448 --> 00:18:03,383
SO, IN THE EARLY 1920s,
656
00:18:03,383 --> 00:18:04,384
SUDDENLY THERE WAS
657
00:18:04,384 --> 00:18:05,385
A SPECIAL RATE
658
00:18:05,385 --> 00:18:06,386
FOR CAPITAL GAINS,
659
00:18:06,386 --> 00:18:08,121
A LOW RATE FOR CAPITAL GAINS.
660
00:18:08,121 --> 00:18:09,122
THERE WAS RELIEF
661
00:18:09,122 --> 00:18:10,123
FOR CONTRIBUTIONS
662
00:18:10,123 --> 00:18:11,191
TO RETIREMENT PLANS,
663
00:18:11,191 --> 00:18:12,825
AND LITTLE BY LITTLE,
664
00:18:12,825 --> 00:18:14,394
THE INCOME TAX BECAME
665
00:18:14,394 --> 00:18:15,428
SOMETHING OTHER THAN
666
00:18:15,428 --> 00:18:17,264
A REVENUE RAISING SYSTEM.
667
00:18:17,264 --> 00:18:20,133
IT BECAME ALSO, AS IT IS TODAY,
668
00:18:20,133 --> 00:18:22,269
A WAY OF TRYING TO MICROMANAGE
669
00:18:22,269 --> 00:18:23,803
THE WAY PEOPLE BEHAVE,
670
00:18:23,803 --> 00:18:24,837
OR TO GIVE THEM RELIEF
671
00:18:24,837 --> 00:18:25,905
FOR CERTAIN BEHAVIOR
672
00:18:25,905 --> 00:18:27,140
HOPING THAT THEY WILL
673
00:18:27,140 --> 00:18:28,241
BEHAVE IN THAT WAY.
674
00:18:28,241 --> 00:18:29,576
>> Man: THE WAR IS OVER,
675
00:18:29,576 --> 00:18:33,280
AND THERE'LL NEVER BE ANOTHER.
676
00:18:33,280 --> 00:18:34,714
>> ( marching bands playing )
677
00:18:34,714 --> 00:18:36,316
>> Thorndike: THE WAR ENDS,
678
00:18:36,316 --> 00:18:37,317
AND THERE'S A SORT OF
679
00:18:37,317 --> 00:18:38,318
SCALING BACK.
680
00:18:38,318 --> 00:18:39,686
THERE'S A, "YOU KNOW, WE DON'T
681
00:18:39,686 --> 00:18:41,154
NEED AS MUCH MONEY ANYMORE.
682
00:18:41,154 --> 00:18:42,555
WE DO NEED TO RETIRE SOME DEBT,
683
00:18:42,555 --> 00:18:44,557
BUT WE CAN LET GO
684
00:18:44,557 --> 00:18:46,159
SOME OF THAT WARTIME TAXATION,
685
00:18:46,159 --> 00:18:47,594
SOME OF THAT PAINFUL,
686
00:18:47,594 --> 00:18:49,829
SACRIFICIAL WARTIME TAXATION."
687
00:18:49,829 --> 00:18:51,231
THE LEADER OF THAT EFFORT
688
00:18:51,231 --> 00:18:52,232
AFTER WORLD WAR ONE
689
00:18:52,232 --> 00:18:53,700
WAS ANDREW MELLON,
690
00:18:53,700 --> 00:18:55,635
WHO WAS SUCH A POWERFUL
691
00:18:55,635 --> 00:18:57,237
TREASURY SECRETARY
692
00:18:57,237 --> 00:18:58,238
THAT HE SERVED
693
00:18:58,238 --> 00:18:59,506
IN THREE ADMINISTRATIONS.
694
00:18:59,506 --> 00:19:00,707
PEOPLE OFTEN SAID
695
00:19:00,707 --> 00:19:02,409
THAT THREE DIFFERENT PRESIDENTS
696
00:19:02,409 --> 00:19:03,743
SERVED UNDER HIM.
697
00:19:03,743 --> 00:19:05,412
BUT I THINK WHAT'S MOST STRIKING
698
00:19:05,412 --> 00:19:06,946
ABOUT ANDREW MELLON IS NOT
699
00:19:06,946 --> 00:19:07,947
THAT HE CUT TAXES,
700
00:19:07,947 --> 00:19:09,416
WHICH I THINK ALMOST ANYONE
701
00:19:09,416 --> 00:19:10,583
WOULD'VE DONE IN THE WAKE
702
00:19:10,583 --> 00:19:11,918
OF WORLD WAR ONE, BUT THAT HE,
703
00:19:11,918 --> 00:19:12,919
BY CUTTING TAXES,
704
00:19:12,919 --> 00:19:14,187
BY SORT OF DE-FANGING
705
00:19:14,187 --> 00:19:15,622
THE INCOME TAX, UH,
706
00:19:15,622 --> 00:19:17,524
AND MAKING IT MORE MODERATE,
707
00:19:17,524 --> 00:19:19,259
ENSURED THAT IT WOULD SURVIVE.
708
00:19:19,259 --> 00:19:20,393
IF WOODROW WILSON MADE
709
00:19:20,393 --> 00:19:21,928
THE WORLD SAFE FOR DEMOCRACY,
710
00:19:21,928 --> 00:19:23,463
ANDREW MELLON MADE THE WORLD
711
00:19:23,463 --> 00:19:25,465
SAFE FOR INCOME TAXATION.
712
00:19:25,465 --> 00:19:27,200
HE MADE IT A TAX
713
00:19:27,200 --> 00:19:28,601
THAT PEOPLE COULD TOLERATE.
714
00:19:28,601 --> 00:19:30,537
>> FDR: YESTERDAY,
715
00:19:30,537 --> 00:19:36,776
DECEMBER 7th, 1941,
716
00:19:36,776 --> 00:19:38,978
A DATE WHICH WILL
717
00:19:38,978 --> 00:19:42,315
LIVE IN INFAMY...
718
00:19:42,315 --> 00:19:46,253
>> ( explosions )
719
00:19:48,921 --> 00:19:51,891
>> THE UNITED STATES OF AMERICA
720
00:19:51,891 --> 00:19:52,892
WAS SUDDENLY
721
00:19:52,892 --> 00:19:54,827
AND DELIBERATELY ATTACKED
722
00:19:54,827 --> 00:19:57,630
BY NAVAL AND AIR FORCES
723
00:19:57,630 --> 00:20:01,668
OF THE EMPIRE OF JAPAN.
724
00:20:01,668 --> 00:20:03,636
NO MATTER HOW LONG IT MAY
725
00:20:03,636 --> 00:20:06,373
TAKE US TO OVERCOME
726
00:20:06,373 --> 00:20:09,276
THIS PREMEDITATED INVASION,
727
00:20:09,276 --> 00:20:10,777
THE AMERICAN PEOPLE
728
00:20:10,777 --> 00:20:12,779
IN THEIR RIGHTEOUS MIGHT
729
00:20:12,779 --> 00:20:14,381
WILL WIN THROUGH
730
00:20:14,381 --> 00:20:15,448
TO ABSOLUTE VICTORY.
731
00:20:15,448 --> 00:20:16,916
>> ( people cheering )
732
00:20:16,916 --> 00:20:18,318
>> BEFORE WORLD WAR TWO--
733
00:20:18,318 --> 00:20:21,421
1939, 1940-- NO MORE THAN 10%
734
00:20:21,421 --> 00:20:22,922
OF HOUSEHOLDS PAID
735
00:20:22,922 --> 00:20:23,923
THE INCOME TAX.
736
00:20:23,923 --> 00:20:26,626
IT REMAINED A CLASS TAX.
737
00:20:26,626 --> 00:20:28,695
BUT THEN PEARL HARBOR HAPPENED,
738
00:20:28,695 --> 00:20:31,298
AND HITLER INVADED EUROPE.
739
00:20:31,298 --> 00:20:32,532
AND FRANKLIN ROOSEVELT
740
00:20:32,532 --> 00:20:33,566
CAME TO THE CONGRESS
741
00:20:33,566 --> 00:20:35,034
AND CAME TO THE AMERICAN PEOPLE
742
00:20:35,034 --> 00:20:36,536
AND SAID THAT THE FUTURE
743
00:20:36,536 --> 00:20:37,537
OF THE UNITED STATES
744
00:20:37,537 --> 00:20:38,538
WAS AT STAKE.
745
00:20:38,538 --> 00:20:39,672
AND HE SAID, "SO, WE HAVE
746
00:20:39,672 --> 00:20:41,774
TO MOVE FROM A TAX ON THE FEW
747
00:20:41,774 --> 00:20:43,676
TO A MASS TAX
748
00:20:43,676 --> 00:20:45,878
THAT IS ON THE MANY."
749
00:20:45,878 --> 00:20:47,680
>> BUT THE RICH PAY THE TAXES.
750
00:20:47,680 --> 00:20:50,283
WHY SHOULD I WORRY?
751
00:20:50,283 --> 00:20:51,351
>> THAT'S WHERE WE'RE
752
00:20:51,351 --> 00:20:52,785
FOOLING OURSELVES.
753
00:20:52,785 --> 00:20:53,786
>> THIS WAS A REALLY
754
00:20:53,786 --> 00:20:54,787
IMPORTANT CHANGE.
755
00:20:54,787 --> 00:20:56,689
THEY LOWER THE EXEMPTIONS,
756
00:20:56,689 --> 00:20:58,691
AND SUDDENLY MILLIONS OF PEOPLE
757
00:20:58,691 --> 00:20:59,692
WHO HAVE NEVER PAID
758
00:20:59,692 --> 00:21:00,993
AN INCOME TAX IN THE PAST
759
00:21:00,993 --> 00:21:02,829
AND WHO HAVE, SOME OF THEM,
760
00:21:02,829 --> 00:21:03,863
ASPIRED TO THE NOTION
761
00:21:03,863 --> 00:21:05,064
OF SOMEDAY GETTING TO PAY
762
00:21:05,064 --> 00:21:06,366
INCOME TAX, 'CAUSE IT WOULD MEAN
763
00:21:06,366 --> 00:21:07,367
THAT THEY WERE RICH,
764
00:21:07,367 --> 00:21:08,435
WELL, THEY WERE NOT ALL
765
00:21:08,435 --> 00:21:09,636
THAT RICH AND SUDDENLY FINDING
766
00:21:09,636 --> 00:21:10,970
THEMSELVES PAYING INCOME TAXES.
767
00:21:10,970 --> 00:21:13,706
>> THE 1942 REVENUE BILL
768
00:21:13,706 --> 00:21:15,442
WILL IMPOSE THE HEAVIEST
769
00:21:15,442 --> 00:21:17,444
TAX BURDEN EVER PLACED
770
00:21:17,444 --> 00:21:19,646
UPON THE AMERICAN CITIZENS.
771
00:21:19,646 --> 00:21:20,713
>> FOR SINGLE PEOPLE,
772
00:21:20,713 --> 00:21:21,848
NOW THE VALUE OF DOLLARS
773
00:21:21,848 --> 00:21:22,849
WERE DIFFERENT--
774
00:21:22,849 --> 00:21:24,083
OF A DOLLAR WAS DIFFERENT.
775
00:21:24,083 --> 00:21:25,552
BUT SINGLE PEOPLE PAID A TAX
776
00:21:25,552 --> 00:21:27,820
ON INCOME OVER $500
777
00:21:27,820 --> 00:21:31,391
UNDER THE 1942-43 REVENUE ACTS.
778
00:21:31,391 --> 00:21:32,725
>> THE NATIONAL ASSOCIATION
779
00:21:32,725 --> 00:21:34,026
OF MANUFACTURERS,
780
00:21:34,026 --> 00:21:35,595
YOU KNOW, INTERESTED IN,
781
00:21:35,595 --> 00:21:37,697
TODAY, NOT PAYING MORE TAXES
782
00:21:37,697 --> 00:21:39,599
THAN THEY ABSOLUTELY HAVE TO--
783
00:21:39,599 --> 00:21:41,868
THEY SAID THAT NO BUSINESS
784
00:21:41,868 --> 00:21:42,869
SHOULD MAKE MORE
785
00:21:42,869 --> 00:21:44,537
THAN THEY ABSOLUTELY NEEDED
786
00:21:44,537 --> 00:21:47,574
TO STAY ALIVE, AND TAXES
787
00:21:47,574 --> 00:21:49,776
SHOULD CONSUME EVERYTHING ELSE.
788
00:21:49,776 --> 00:21:52,345
>> CORPORATION RATES
789
00:21:52,345 --> 00:21:54,914
HAVE ALSO BEEN SUBSTANTIALLY
790
00:21:54,914 --> 00:21:57,550
INCREASED ON BOTH NORMAL
791
00:21:57,550 --> 00:21:59,786
AND EXCESS PROFITS.
792
00:21:59,786 --> 00:22:01,521
WE BELIEVE THESE RATES
793
00:22:01,521 --> 00:22:03,523
ARE ADEQUATE TO PREVENT
794
00:22:03,523 --> 00:22:07,894
ANYONE REALIZING UNDUE PROFITS
795
00:22:07,894 --> 00:22:10,129
OUT OF THE WAR EFFORT.
796
00:22:10,129 --> 00:22:11,431
>> THIS IS A BIG CHANGE.
797
00:22:11,431 --> 00:22:12,532
IT MAKES THE INCOME TAX
798
00:22:12,532 --> 00:22:13,633
MUCH MORE PRODUCTIVE,
799
00:22:13,633 --> 00:22:14,634
HELPS IT RAISE MUCH,
800
00:22:14,634 --> 00:22:16,068
MUCH MORE MONEY.
801
00:22:16,068 --> 00:22:17,904
IT ALSO POSES ALL SORTS
802
00:22:17,904 --> 00:22:18,905
OF DIFFICULTIES
803
00:22:18,905 --> 00:22:20,373
FOR THE FEDERAL GOVERNMENT,
804
00:22:20,373 --> 00:22:21,574
BECAUSE THEY HAVE TO INSTRUCT
805
00:22:21,574 --> 00:22:22,742
ALL OF THESE PEOPLE IN HOW
806
00:22:22,742 --> 00:22:24,010
TO PAY THEIR INCOME TAXES, WHICH
807
00:22:24,010 --> 00:22:25,111
IS NOT AN EASY THING TO DO.
808
00:22:25,111 --> 00:22:26,613
THEY INSTITUTED A HUGE
809
00:22:26,613 --> 00:22:28,147
PUBLIC RELATIONS CAMPAIGN
810
00:22:28,147 --> 00:22:29,482
TO TELL PEOPLE THAT THIS
811
00:22:29,482 --> 00:22:30,750
WAS THEIR RESPONSIBILITY,
812
00:22:30,750 --> 00:22:31,951
THEY WERE GONNA HAVE TO DO IT.
813
00:22:31,951 --> 00:22:33,620
THEY WANTED TO MAKE A CONNECTION
814
00:22:33,620 --> 00:22:34,621
BETWEEN THE SACRIFICE
815
00:22:34,621 --> 00:22:35,688
THAT PEOPLE WERE MAKING
816
00:22:35,688 --> 00:22:36,723
ON THE BATTLEFIELD
817
00:22:36,723 --> 00:22:37,724
AND THE FINANCIAL SACRIFICE
818
00:22:37,724 --> 00:22:38,925
THAT WAS BEING ASKED OF PEOPLE
819
00:22:38,925 --> 00:22:39,926
ON THE HOME FRONT.
820
00:22:39,926 --> 00:22:41,794
>> I AM WILLING TO PAY TAXES
821
00:22:41,794 --> 00:22:43,796
TO PROVIDE NATIONAL DEFENSE
822
00:22:43,796 --> 00:22:44,797
FOR MY COUNTRY,
823
00:22:44,797 --> 00:22:46,132
TO SEE THAT WE HAVE
824
00:22:46,132 --> 00:22:48,868
AN ARMY, A NAVY, AND AIRPLANES
825
00:22:48,868 --> 00:22:50,637
STRONG ENOUGH TO PROTECT US
826
00:22:50,637 --> 00:22:52,605
AGAINST ANY INVADERS.
827
00:22:52,605 --> 00:22:53,673
>> IT WASN'T JUST ABOUT
828
00:22:53,673 --> 00:22:55,174
CHANGING A FINANCIAL INSTRUMENT;
829
00:22:55,174 --> 00:22:56,676
IT WAS REALLY ABOUT CHANGING
830
00:22:56,676 --> 00:22:57,677
POLITICAL CULTURE
831
00:22:57,677 --> 00:22:58,678
AND CIVIL RITUALS
832
00:22:58,678 --> 00:22:59,679
IN AN IMPORTANT WAY,
833
00:22:59,679 --> 00:23:00,680
AND REALLY CREATING
834
00:23:00,680 --> 00:23:01,881
A WHOLE NEW CIVIC RITUAL.
835
00:23:01,881 --> 00:23:02,882
I MEAN, AMERICANS
836
00:23:02,882 --> 00:23:04,484
HAD NEVER BEEN UNITED
837
00:23:04,484 --> 00:23:06,553
BY THIS ANNUAL RESPONSIBILITY
838
00:23:06,553 --> 00:23:08,788
BEFORE, AND SUDDENLY, UH--
839
00:23:08,788 --> 00:23:10,857
IT WAS ACTUALLY IN MARCH, THEN,
840
00:23:10,857 --> 00:23:11,991
BUT WHAT LATER GOT MOVED
841
00:23:11,991 --> 00:23:13,960
TO APRIL-- APRIL 15tH HAS BECOME
842
00:23:13,960 --> 00:23:15,094
SORT OF A NATIONAL
843
00:23:15,094 --> 00:23:16,929
ANTI-HOLIDAY, YOU KNOW?
844
00:23:16,929 --> 00:23:18,831
IT'S A DAY THAT WE ALL RECOGNIZE
845
00:23:18,831 --> 00:23:20,533
AS PART OF OUR CIVIC
846
00:23:20,533 --> 00:23:22,101
RESPONSIBILITIES, AS OUR--
847
00:23:22,101 --> 00:23:23,570
AS OUR-- IN OUR ROLE
848
00:23:23,570 --> 00:23:24,704
AS AMERICANS.
849
00:24:43,683 --> 00:24:45,785
>> Weisman: FOR AS LONG
850
00:24:45,785 --> 00:24:47,987
AS AMERICANS HAVE BEEN DEBATING
851
00:24:47,987 --> 00:24:49,221
THE INCOME TAX,
852
00:24:49,221 --> 00:24:50,523
THEY'VE BEEN DEBATING
853
00:24:50,523 --> 00:24:52,191
TWO DEFINITIONS OF,
854
00:24:52,191 --> 00:24:53,893
UH, MORALITY.
855
00:24:53,893 --> 00:24:56,262
ON THE ONE SIDE IS WHAT I CALL
856
00:24:56,262 --> 00:24:58,865
VIRTUE, WHICH IS THIS IDEA
857
00:24:58,865 --> 00:25:00,166
THAT AMERICANS HAVE
858
00:25:00,166 --> 00:25:02,669
THAT THEIR-- THAT WEALTH
859
00:25:02,669 --> 00:25:04,203
THAT THEY GAIN IS THE RESULT
860
00:25:04,203 --> 00:25:06,105
OF VIRTUOUS BEHAVIOR--
861
00:25:06,105 --> 00:25:08,908
SAVING, INVESTING, HARD WORK,
862
00:25:08,908 --> 00:25:10,743
TAKING RISKS, AND THAT YOU DON'T
863
00:25:10,743 --> 00:25:11,744
WANT A TAX SYSTEM
864
00:25:11,744 --> 00:25:13,646
THAT PUNISHES THAT,
865
00:25:13,646 --> 00:25:14,914
AND THEREFORE, YOU DON'T WANT
866
00:25:14,914 --> 00:25:15,948
TO PUNISH PEOPLE
867
00:25:15,948 --> 00:25:17,550
AS THEY MAKE MORE MONEY.
868
00:25:17,550 --> 00:25:18,618
BUT ON THE OTHER HAND,
869
00:25:18,618 --> 00:25:20,052
AMERICANS BELIEVE
870
00:25:20,052 --> 00:25:21,954
IN ESSENTIAL FAIRNESS,
871
00:25:21,954 --> 00:25:24,056
AND THAT, ESPECIALLY IN A TIME
872
00:25:24,056 --> 00:25:25,592
OF WAR AND SACRIFICE,
873
00:25:25,592 --> 00:25:26,959
YOU HAVE TO HAVE A SYSTEM
874
00:25:26,959 --> 00:25:28,294
THAT'S FAIR AND SUPPORTED
875
00:25:28,294 --> 00:25:30,162
BY EVERYONE, AND THAT SYSTEM
876
00:25:30,162 --> 00:25:31,163
DOES THE OPPOSITE.
877
00:25:31,163 --> 00:25:33,265
THAT SYSTEM WOULD MAKE PEOPLE
878
00:25:33,265 --> 00:25:34,701
WHO HAVE MORE MONEY
879
00:25:34,701 --> 00:25:37,169
PAY TAXES AT A HIGHER RATE.
880
00:25:37,169 --> 00:25:39,238
I THINK MOST OF US WOULD
881
00:25:39,238 --> 00:25:40,573
SYMPATHIZE WITH EITHER
882
00:25:40,573 --> 00:25:41,674
OF THOSE VIEWS,
883
00:25:41,674 --> 00:25:43,743
AND MAYBE WE GO BACK AND FORTH.
884
00:25:43,743 --> 00:25:45,077
I THINK THAT'S PROBABLY TRUE
885
00:25:45,077 --> 00:25:46,078
OF MOST AMERICANS,
886
00:25:46,078 --> 00:25:47,246
BUT AT ANY GIVEN TIME,
887
00:25:47,246 --> 00:25:50,717
ONE OF THE IDEAS IS UPPERMOST.
888
00:25:50,717 --> 00:25:52,719
>> THESE ISSUES, MANY OF WHICH
889
00:25:52,719 --> 00:25:54,887
NOW INVOLVE AN ECONOMIC CONCERN,
890
00:25:54,887 --> 00:25:57,023
WERE OF VIRTUALLY NO CONCERN
891
00:25:57,023 --> 00:25:58,024
UNTIL THE KENNEDY
892
00:25:58,024 --> 00:25:59,291
ADMINISTRATION.
893
00:25:59,291 --> 00:26:01,293
>> ( fanfare )
894
00:26:01,293 --> 00:26:02,595
>> * KENNEDY, KENNEDY
895
00:26:02,595 --> 00:26:03,930
* KENNEDY, KENNEDY, KENNEDY
896
00:26:03,930 --> 00:26:06,232
* KENNEDY, KEN-NE-DY FOR ME
897
00:26:06,232 --> 00:26:09,368
>> Various Voices: KENNEDY!
898
00:26:09,368 --> 00:26:10,670
>> THE FIRST PRESIDENT
899
00:26:10,670 --> 00:26:11,671
OF THE MODERN ERA
900
00:26:11,671 --> 00:26:12,672
TO EMBRACE THE ISSUE
901
00:26:12,672 --> 00:26:13,873
OF THE INCOME TAX
902
00:26:13,873 --> 00:26:15,642
WAS JOHN F. KENNEDY.
903
00:26:15,642 --> 00:26:17,043
>> SUCH A BILL WILL BE PRESENTED
904
00:26:17,043 --> 00:26:18,044
TO THE CONGRESS
905
00:26:18,044 --> 00:26:19,679
FOR ACTION NEXT YEAR.
906
00:26:19,679 --> 00:26:20,680
IT WILL INCLUDE
907
00:26:20,680 --> 00:26:22,014
AN ACROSS-THE-BOARD,
908
00:26:22,014 --> 00:26:23,750
TOP-TO-BOTTOM CUT
909
00:26:23,750 --> 00:26:24,917
IN BOTH CORPORATE
910
00:26:24,917 --> 00:26:27,153
AND PERSONAL INCOME TAXES.
911
00:26:27,153 --> 00:26:28,154
IT WILL INCLUDE
912
00:26:28,154 --> 00:26:30,289
LONG-NEEDED TAX REFORMS
913
00:26:30,289 --> 00:26:32,825
THAT LOGIC AND EQUITY DEMAND,
914
00:26:32,825 --> 00:26:34,226
AND IT WILL DATE THAT
915
00:26:34,226 --> 00:26:36,696
CUT IN TAXES TO TAKE EFFECT
916
00:26:36,696 --> 00:26:39,298
AS OF THE START OF NEXT YEAR,
917
00:26:39,298 --> 00:26:41,901
JANUARY 1963.
918
00:26:41,901 --> 00:26:42,969
>> KENNEDY CAME ALONG
919
00:26:42,969 --> 00:26:43,970
AND HIS TAX ADVISORS
920
00:26:43,970 --> 00:26:44,971
CAME ALONG AND SAID,
921
00:26:44,971 --> 00:26:46,038
"BUT THESE HIGH RATES
922
00:26:46,038 --> 00:26:48,107
RETARD ECONOMIC GROWTH,"
923
00:26:48,107 --> 00:26:49,909
AND THAT BEGAN
924
00:26:49,909 --> 00:26:51,844
THE REAL CONVERSATION
925
00:26:51,844 --> 00:26:52,979
ABOUT THE RELATIONSHIP
926
00:26:52,979 --> 00:26:54,346
BETWEEN TAX RATES
927
00:26:54,346 --> 00:26:56,282
AND ECONOMIC OUTCOMES.
928
00:26:56,282 --> 00:26:57,316
>> HE HADN'T GIVEN OUT
929
00:26:57,316 --> 00:26:58,317
LITTLE INCREASES
930
00:26:58,317 --> 00:26:59,719
IN THE PERSONAL EXEMPTION
931
00:26:59,719 --> 00:27:00,920
OR THE STANDARD DEDUCTION.
932
00:27:00,920 --> 00:27:01,954
HE'D ACTUALLY GONE IN
933
00:27:01,954 --> 00:27:03,289
AND SLASHED THE WORLD WAR TWO
934
00:27:03,289 --> 00:27:04,791
AND KOREAN WAR TAX RATES,
935
00:27:04,791 --> 00:27:05,792
THE MARGINAL RATES,
936
00:27:05,792 --> 00:27:06,926
ACROSS THE BOARD.
937
00:27:06,926 --> 00:27:08,194
HE TOOK THE TOP RATE DOWN
938
00:27:08,194 --> 00:27:10,096
FROM 91% TO 70,
939
00:27:10,096 --> 00:27:11,698
AND THE BOTTOM RATE DOWN
940
00:27:11,698 --> 00:27:14,000
FROM 20 TO 14.
941
00:27:14,000 --> 00:27:15,001
AND WE HAD SEVERAL
942
00:27:15,001 --> 00:27:16,068
GOOD YEARS OF GROWTH
943
00:27:16,068 --> 00:27:17,403
AFTER THE KENNEDY TAX CUTS,
944
00:27:17,403 --> 00:27:19,071
UNLIKE THE LATER CUTS
945
00:27:19,071 --> 00:27:20,272
OF THE 1970s, WHICH WERE
946
00:27:20,272 --> 00:27:21,974
JUST THESE LITTLE HANDOUTS
947
00:27:21,974 --> 00:27:23,109
ON THE FIRST TWO OR THREE
948
00:27:23,109 --> 00:27:25,044
OF FIVE DOLLARS THAT YOU EARNED.
949
00:27:25,044 --> 00:27:26,378
>> Weisman: I THINK IT WAS
950
00:27:26,378 --> 00:27:28,214
REALLY IN THE 1970s
951
00:27:28,214 --> 00:27:31,784
THAT TAXES BECAME A BIG NATIONAL
952
00:27:31,784 --> 00:27:33,252
AND ALMOST MORAL ISSUE.
953
00:27:33,252 --> 00:27:34,320
>> Shaviro: PEOPLE STARTED
954
00:27:34,320 --> 00:27:35,421
GETTING A LOT MORE UNHAPPY
955
00:27:35,421 --> 00:27:36,422
WITH THE GOVERNMENT.
956
00:27:36,422 --> 00:27:37,890
YOU HAVE THE VIETNAM WAR
957
00:27:37,890 --> 00:27:39,025
AND NIXON AND WATERGATE
958
00:27:39,025 --> 00:27:40,359
AND ALL THOSE THINGS.
959
00:27:40,359 --> 00:27:41,694
AND ALSO, IN THE 1970s,
960
00:27:41,694 --> 00:27:43,863
YOU GET INCREDIBLE TAX INCREASES
961
00:27:43,863 --> 00:27:45,264
THAT WEREN'T ACTUALLY ENACTED
962
00:27:45,264 --> 00:27:46,432
BY THE CONGRESS.
963
00:27:46,432 --> 00:27:47,967
IT WAS BECAUSE OF INFLATION.
964
00:27:47,967 --> 00:27:49,068
IT TURNED OUT THAT WHEN
965
00:27:49,068 --> 00:27:50,302
THERE WAS HIGH INFLATION,
966
00:27:50,302 --> 00:27:51,704
PEOPLE WERE BEING PUSHED
967
00:27:51,704 --> 00:27:53,072
INTO HIGHER TAX BRACKETS.
968
00:27:53,072 --> 00:27:54,206
IT MIGHT BE THAT YOU USED
969
00:27:54,206 --> 00:27:55,207
TO PAY TAXES AT 30%.
970
00:27:55,207 --> 00:27:56,308
NOW, YOU REALLY HAVE
971
00:27:56,308 --> 00:27:57,710
THE SAME SPENDING POWER
972
00:27:57,710 --> 00:27:58,878
AS BEFORE, BUT NOW YOU'RE
973
00:27:58,878 --> 00:28:00,479
PAYING SOME TAX AT 40%.
974
00:28:00,479 --> 00:28:01,480
>> SO, WE DECIDED
975
00:28:01,480 --> 00:28:02,882
AT THE END OF THE '70s
976
00:28:02,882 --> 00:28:03,883
THAT WE NEEDED TO TRY
977
00:28:03,883 --> 00:28:04,984
THAT AGAIN-- WE NEEDED
978
00:28:04,984 --> 00:28:06,719
TO REPEAT THE KENNEDY EXPERIMENT
979
00:28:06,719 --> 00:28:07,720
TO SEE IF LOWERING
980
00:28:07,720 --> 00:28:08,721
THE MARGINAL RATES
981
00:28:08,721 --> 00:28:10,056
AND PERHAPS PUTTING ON
982
00:28:10,056 --> 00:28:11,357
THE INVESTMENT TAX CREDIT
983
00:28:11,357 --> 00:28:12,725
THAT HE HAD ALSO USED
984
00:28:12,725 --> 00:28:13,726
TO SPUR INVESTMENT,
985
00:28:13,726 --> 00:28:14,727
MIGHT GET US OUT
986
00:28:14,727 --> 00:28:15,928
OF THE STAGFLATION.
987
00:28:15,928 --> 00:28:17,129
>> AND, OF COURSE, THE MAN
988
00:28:17,129 --> 00:28:19,331
WHO RODE THAT ISSUE
989
00:28:19,331 --> 00:28:20,867
INTO THE WHITE HOUSE
990
00:28:20,867 --> 00:28:22,935
WAS RONALD REAGAN,
991
00:28:22,935 --> 00:28:24,436
WHO I LIKE TO THINK OF
992
00:28:24,436 --> 00:28:25,437
AS THE POET LAUREATE
993
00:28:25,437 --> 00:28:27,206
OF CAPITALISM.
994
00:28:27,206 --> 00:28:28,841
>> Reagan: I'M A CITIZEN.
995
00:28:28,841 --> 00:28:30,076
I'M NOT AN OFFICEHOLDER
996
00:28:30,076 --> 00:28:31,077
OR A PARTY OFFICIAL.
997
00:28:31,077 --> 00:28:32,078
I'LL MAKE A SPEECH
998
00:28:32,078 --> 00:28:33,145
AT A BUS STOP IF ENOUGH
999
00:28:33,145 --> 00:28:34,947
PEOPLE ARE WAITIN'.
1000
00:28:34,947 --> 00:28:35,948
I WAS A DEMOCRAT
1001
00:28:35,948 --> 00:28:37,216
MOST OF MY LIFE.
1002
00:28:37,216 --> 00:28:39,051
I HAVE A LONG PENANCE TO DO.
1003
00:28:39,051 --> 00:28:40,753
>> ( laughter )
1004
00:28:40,753 --> 00:28:41,888
>> IF YOU'RE UNWILLING
1005
00:28:41,888 --> 00:28:43,189
TO MEET THIS CHALLENGE,
1006
00:28:43,189 --> 00:28:44,857
THEN YOU'D BETTER START
1007
00:28:44,857 --> 00:28:46,425
PREPARING, DECIDING WHAT
1008
00:28:46,425 --> 00:28:47,860
YOU'LL TELL YOUR CHILDREN
1009
00:28:47,860 --> 00:28:48,861
IT WAS THAT YOU FOUND
1010
00:28:48,861 --> 00:28:50,329
MORE IMPORTANT THAN FREEDOM.
1011
00:28:50,329 --> 00:28:52,098
THEY'LL WANNA KNOW.
1012
00:28:52,098 --> 00:28:54,333
IN THIS PRESENT CRISIS,
1013
00:28:54,333 --> 00:28:56,068
GOVERNMENT IS NOT
1014
00:28:56,068 --> 00:28:58,070
THE SOLUTION TO OUR PROBLEMS.
1015
00:28:58,070 --> 00:29:00,206
GOVERNMENT IS THE PROBLEM.
1016
00:29:00,206 --> 00:29:01,240
FROM TIME TO TIME,
1017
00:29:01,240 --> 00:29:02,809
WE'VE BEEN TEMPTED TO BELIEVE
1018
00:29:02,809 --> 00:29:04,010
THAT SOCIETY HAS BECOME
1019
00:29:04,010 --> 00:29:05,845
TOO COMPLEX TO BE MANAGED
1020
00:29:05,845 --> 00:29:06,846
BY SELF-RULE,
1021
00:29:06,846 --> 00:29:08,014
THAT GOVERNMENT BY
1022
00:29:08,014 --> 00:29:09,481
AN ELITE GROUP IS SUPERIOR
1023
00:29:09,481 --> 00:29:12,084
TO GOVERNMENT FOR, BY,
1024
00:29:12,084 --> 00:29:14,453
AND OF THE PEOPLE.
1025
00:29:14,453 --> 00:29:16,455
>> NO ONE BEFORE OR SINCE
1026
00:29:16,455 --> 00:29:18,925
HAS, UH, PAINTED SUCH
1027
00:29:18,925 --> 00:29:20,526
A VISIONARY PICTURE
1028
00:29:20,526 --> 00:29:22,528
OF HOW AMERICANS ARE BURDENED
1029
00:29:22,528 --> 00:29:24,897
BY THE TAX SYSTEM.
1030
00:29:24,897 --> 00:29:26,833
>> IN SHORT, A PUNITIVE
1031
00:29:26,833 --> 00:29:28,801
TAX SYSTEM MUST BE REPLACED
1032
00:29:28,801 --> 00:29:30,169
BY ONE THAT RESTORES
1033
00:29:30,169 --> 00:29:31,871
INCENTIVE FOR THE WORKER
1034
00:29:31,871 --> 00:29:33,472
AND FOR INDUSTRY,
1035
00:29:33,472 --> 00:29:35,107
A SYSTEM THAT REWARDS
1036
00:29:35,107 --> 00:29:37,076
INITIATIVE AND EFFORT
1037
00:29:37,076 --> 00:29:39,912
AND ENCOURAGES THRIFT.
1038
00:29:39,912 --> 00:29:41,247
NOW, ALL THESE THINGS
1039
00:29:41,247 --> 00:29:42,514
ARE POSSIBLE.
1040
00:29:42,514 --> 00:29:43,950
NONE OF THEM WILL BE EASY,
1041
00:29:43,950 --> 00:29:45,918
BUT THE CHOICE IS CLEAR.
1042
00:29:45,918 --> 00:29:47,219
WE CAN GO ON LETTING
1043
00:29:47,219 --> 00:29:48,220
THE COUNTRY SLIP
1044
00:29:48,220 --> 00:29:49,221
OVER THE BRINK
1045
00:29:49,221 --> 00:29:50,222
OF FINANCIAL RUIN
1046
00:29:50,222 --> 00:29:51,523
WITH THE DISASTER WHICH THIS
1047
00:29:51,523 --> 00:29:52,959
MEANS FOR THE INDIVIDUAL,
1048
00:29:52,959 --> 00:29:54,293
OR WE CAN FIND THE WILL
1049
00:29:54,293 --> 00:29:55,962
TO WORK TOGETHER,
1050
00:29:55,962 --> 00:29:57,496
TO RESTORE CONFIDENCE
1051
00:29:57,496 --> 00:29:58,497
IN OURSELVES
1052
00:29:58,497 --> 00:29:59,999
AND TO REGAIN THE CONFIDENCE
1053
00:29:59,999 --> 00:30:01,100
OF THE WORLD.
1054
00:30:01,100 --> 00:30:02,134
>> Fox: RONALD REAGAN
1055
00:30:02,134 --> 00:30:03,970
CAME INTO OFFICE BELIEVING
1056
00:30:03,970 --> 00:30:05,137
THAT HIGH TAX RATES
1057
00:30:05,137 --> 00:30:07,039
DISCOURAGE ECONOMIC GROWTH
1058
00:30:07,039 --> 00:30:08,140
AND DISCOURAGE PEOPLE
1059
00:30:08,140 --> 00:30:09,208
FROM WORKING HARDER.
1060
00:30:09,208 --> 00:30:10,209
THE CONTEXT FOR HIM
1061
00:30:10,209 --> 00:30:11,911
WAS THE MOVIE INDUSTRY.
1062
00:30:11,911 --> 00:30:14,113
>> Man: ALL RIGHT, GET ON STAGE,
1063
00:30:14,113 --> 00:30:15,882
YOU PRIMA DONNAS. LET'S GO!
1064
00:30:15,882 --> 00:30:17,049
GET ON FOR STAGE FOUR...
1065
00:30:17,049 --> 00:30:18,985
>> HEY, FELLAS!
1066
00:30:18,985 --> 00:30:20,186
GET A LOAD OF THIS WIRE.
1067
00:30:20,186 --> 00:30:22,021
>> ANYBODY I KNOW?
1068
00:30:22,021 --> 00:30:23,422
>> WE'RE GOING ON TOUR.
1069
00:30:23,422 --> 00:30:24,623
WHAT DO YOU KNOW, BOSTON,
1070
00:30:24,623 --> 00:30:26,225
PHILADELPHIA, WASHINGTON...
1071
00:30:26,225 --> 00:30:27,860
>> WASHINGTON? HEY, WOULDN'T IT
1072
00:30:27,860 --> 00:30:29,195
BE SOMETHING IF THE PRESIDENT
1073
00:30:29,195 --> 00:30:30,196
CAME TO SEE US,
1074
00:30:30,196 --> 00:30:31,197
THE CHIEF HIMSELF?
1075
00:30:31,197 --> 00:30:32,431
>> Weisman: HE'D MAKE A CERTAIN
1076
00:30:32,431 --> 00:30:33,866
NUMBER OF MOVIES, AND THEN
1077
00:30:33,866 --> 00:30:36,068
ANYTIME HE MADE ANOTHER MOVIE,
1078
00:30:36,068 --> 00:30:37,369
HE FIGURED THAT 80 OR 90%
1079
00:30:37,369 --> 00:30:39,005
OF THE INCOME HE WAS
1080
00:30:39,005 --> 00:30:40,506
GETTING FROM THAT MOVIE
1081
00:30:40,506 --> 00:30:42,141
WOULD GO TO THE FEDERAL
1082
00:30:42,141 --> 00:30:43,475
GOVERNMENT, SO HE WOULD STOP
1083
00:30:43,475 --> 00:30:44,610
MAKING MOVIES AND GO OFF
1084
00:30:44,610 --> 00:30:45,611
AND RIDE HORSES.
1085
00:30:45,611 --> 00:30:46,979
HE JUST BECAME CONVINCED,
1086
00:30:46,979 --> 00:30:48,480
BASED ON HIS PERSONAL EXPERIENCE
1087
00:30:48,480 --> 00:30:49,481
THAT A HIGH TAX RATE
1088
00:30:49,481 --> 00:30:50,482
DISCOURAGES PEOPLE
1089
00:30:50,482 --> 00:30:51,951
FROM WORKING HARD
1090
00:30:51,951 --> 00:30:54,120
AND-- AND GOING THE EXTRA MILE
1091
00:30:54,120 --> 00:30:55,121
TO BE PRODUCTIVE.
1092
00:30:55,121 --> 00:30:57,189
AND HE RODE THAT IDEA-- I--
1093
00:30:57,189 --> 00:30:58,925
BECAUSE HE BELIEVED IT
1094
00:30:58,925 --> 00:31:00,026
AND BECAUSE HE WAS SUCH
1095
00:31:00,026 --> 00:31:01,160
A GREAT COMMUNICATOR,
1096
00:31:01,160 --> 00:31:02,561
HE RODE IT INTO THE WHITE HOUSE,
1097
00:31:02,561 --> 00:31:04,663
AND HE RODE IT INTO THE BRAINS
1098
00:31:04,663 --> 00:31:06,432
OF AMERICANS.
1099
00:31:06,432 --> 00:31:07,433
>> WE MUST GO FORWARD
1100
00:31:07,433 --> 00:31:09,435
WITH A TAX RELIEF PACKAGE.
1101
00:31:09,435 --> 00:31:11,670
I SHALL ASK FOR A 10% REDUCTION
1102
00:31:11,670 --> 00:31:12,671
ACROSS THE BOARD
1103
00:31:12,671 --> 00:31:15,074
IN PERSONAL INCOME TAX RATES
1104
00:31:15,074 --> 00:31:16,475
FOR EACH OF THE NEXT
1105
00:31:16,475 --> 00:31:17,576
THREE YEARS.
1106
00:31:17,576 --> 00:31:19,311
>> Fox: HE WAS THE SPONSOR,
1107
00:31:19,311 --> 00:31:20,312
THE SUPPORTER OF
1108
00:31:20,312 --> 00:31:22,181
THE ECONOMIC RECOVERY TAX ACT
1109
00:31:22,181 --> 00:31:24,450
OF 1981, AND IT'S THE FIRST TIME
1110
00:31:24,450 --> 00:31:25,451
THEY GAVE A NAME
1111
00:31:25,451 --> 00:31:26,452
TO A TAX REFORM.
1112
00:31:26,452 --> 00:31:28,087
>> THE IMPORTANT THING NOW
1113
00:31:28,087 --> 00:31:29,088
IS TO HOLD TO A FIRM,
1114
00:31:29,088 --> 00:31:30,923
STEADY COURSE.
1115
00:31:30,923 --> 00:31:32,624
TONIGHT, I WANT TO TALK WITH YOU
1116
00:31:32,624 --> 00:31:33,625
ABOUT THE NEXT STEPS
1117
00:31:33,625 --> 00:31:34,626
THAT WE MUST TAKE
1118
00:31:34,626 --> 00:31:35,627
ON THAT COURSE,
1119
00:31:35,627 --> 00:31:37,129
ADDITIONAL REDUCTIONS
1120
00:31:37,129 --> 00:31:38,130
IN FEDERAL SPENDING
1121
00:31:38,130 --> 00:31:39,131
THAT WILL HELP LOWER
1122
00:31:39,131 --> 00:31:40,132
OUR INTEREST RATES,
1123
00:31:40,132 --> 00:31:41,500
OUR INFLATION,
1124
00:31:41,500 --> 00:31:42,935
AND BRING US CLOSER
1125
00:31:42,935 --> 00:31:45,004
TO FULL ECONOMIC RECOVERY.
1126
00:31:45,004 --> 00:31:46,272
>> DAVID STOCKMAN ADMITTED,
1127
00:31:46,272 --> 00:31:47,273
WHEN HE WAS THE HEAD
1128
00:31:47,273 --> 00:31:48,607
OF THE CONGRESSIONAL BUDGET
1129
00:31:48,607 --> 00:31:49,608
OFFICE FOR REAGAN,
1130
00:31:49,608 --> 00:31:50,609
WAS THAT IN FIGHTING
1131
00:31:50,609 --> 00:31:53,512
FOR LOW TAX RATES, HE EXPECTED
1132
00:31:53,512 --> 00:31:55,314
THE REAGAN REVOLUTION ALSO
1133
00:31:55,314 --> 00:31:56,983
TO REDUCE GOVERNMENT,
1134
00:31:56,983 --> 00:31:57,984
BUT THEY FOUND--
1135
00:31:57,984 --> 00:31:59,185
THE REPUBLICANS FOUND--
1136
00:31:59,185 --> 00:32:01,120
THAT THE-- THERE WAS TOO MUCH
1137
00:32:01,120 --> 00:32:02,454
ENTRENCHED IN THE GOVERNMENT
1138
00:32:02,454 --> 00:32:04,623
PROGRAMS, AND SO GOVERNMENT
1139
00:32:04,623 --> 00:32:05,992
SPENDING WENT WAY UP.
1140
00:32:05,992 --> 00:32:07,226
SO, IT REALLY DIDN'T TEST
1141
00:32:07,226 --> 00:32:09,128
SUPPLY-SIDE ECONOMICS
1142
00:32:09,128 --> 00:32:11,163
IN THE BEST OF CONDITIONS.
1143
00:32:11,163 --> 00:32:13,199
>> REAGAN SOMETIMES GETS CREDIT
1144
00:32:13,199 --> 00:32:14,700
FOR MASSIVELY LOWER TAXING,
1145
00:32:14,700 --> 00:32:15,968
BUT THAT SHORT PERIOD
1146
00:32:15,968 --> 00:32:17,970
BETWEEN '80 AND '84 WERE--
1147
00:32:17,970 --> 00:32:18,971
WHEN I WAS HERE--
1148
00:32:18,971 --> 00:32:21,173
HE, UH, LOWERED THE TAX RATES,
1149
00:32:21,173 --> 00:32:22,274
AND THAT WAS VERY GOOD,
1150
00:32:22,274 --> 00:32:23,409
BUT HE ALSO HAD THREE TAX
1151
00:32:23,409 --> 00:32:25,144
INCREASES-- SOCIAL SECURITY
1152
00:32:25,144 --> 00:32:26,145
TAXES WENT UP,
1153
00:32:26,145 --> 00:32:27,413
AND OTHER REVENUES WENT UP,
1154
00:32:27,413 --> 00:32:29,215
AND IT WAS ALL CANCELED OUT
1155
00:32:29,215 --> 00:32:31,050
AND, UH, SPENDING WENT UP
1156
00:32:31,050 --> 00:32:33,019
AND THE DEFICIT EXPLODED.
1157
00:32:33,019 --> 00:32:34,020
>> ONE OF THE THINGS
1158
00:32:34,020 --> 00:32:35,121
ABOUT REAGAN WAS THAT WHEN HE
1159
00:32:35,121 --> 00:32:36,188
WAS CONVINCED THAT WE NEEDED
1160
00:32:36,188 --> 00:32:37,189
HIGHER TAXES, HE JUST WENT OUT
1161
00:32:37,189 --> 00:32:38,190
AND GAVE A SPEECH.
1162
00:32:38,190 --> 00:32:39,258
>> WE'RE WITHIN SIGHT
1163
00:32:39,258 --> 00:32:40,259
OF THE SAFE PORT
1164
00:32:40,259 --> 00:32:41,660
OF ECONOMIC RECOVERY.
1165
00:32:41,660 --> 00:32:43,395
DO WE MAKE PORT
1166
00:32:43,395 --> 00:32:45,264
OR GO AGROUND ON THE SHOALS
1167
00:32:45,264 --> 00:32:47,233
OF SELFISHNESS, PARTISANSHIP,
1168
00:32:47,233 --> 00:32:49,535
AND JUST PLAIN BULL-HEADEDNESS?
1169
00:32:49,535 --> 00:32:51,003
THE MEASURE THAT CONGRESS
1170
00:32:51,003 --> 00:32:52,371
IS ABOUT TO VOTE ON,
1171
00:32:52,371 --> 00:32:53,672
WHILE NOT PERFECT IN THE EYES
1172
00:32:53,672 --> 00:32:54,673
OF ANY ONE OF US,
1173
00:32:54,673 --> 00:32:56,408
WILL BRING US CLOSER
1174
00:32:56,408 --> 00:32:57,776
TO THE GOAL
1175
00:32:57,776 --> 00:32:59,045
OF A BALANCED BUDGET,
1176
00:32:59,045 --> 00:33:01,180
RESTORED INDUSTRIAL POWER,
1177
00:33:01,180 --> 00:33:02,314
AND EMPLOYMENT FOR ALL
1178
00:33:02,314 --> 00:33:04,083
WHO WANT TO WORK.
1179
00:33:04,083 --> 00:33:05,784
TOGETHER, WE CAN REACH
1180
00:33:05,784 --> 00:33:07,653
THAT GOAL.
1181
00:33:07,653 --> 00:33:08,787
>> ON A BIPARTISAN BASIS
1182
00:33:08,787 --> 00:33:10,256
IN THE SENATE AND THE HOUSE,
1183
00:33:10,256 --> 00:33:12,158
PEOPLE REALLY BEGAN TO STUDY
1184
00:33:12,158 --> 00:33:13,159
WHAT TAXES DO
1185
00:33:13,159 --> 00:33:14,226
THROUGH THE ECONOMY,
1186
00:33:14,226 --> 00:33:15,527
HOW PEOPLE CHANGE THEIR BEHAVIOR
1187
00:33:15,527 --> 00:33:16,528
IN RESPONSE TO
1188
00:33:16,528 --> 00:33:17,596
DIFFERENT TAX POLICIES.
1189
00:33:17,596 --> 00:33:18,597
>> Burman: IN THE EARLY '80s,
1190
00:33:18,597 --> 00:33:19,598
TAX SHELTERS
1191
00:33:19,598 --> 00:33:20,666
WERE REALLY RAMPANT.
1192
00:33:20,666 --> 00:33:22,268
THERE WERE STORIES ALL THE TIME
1193
00:33:22,268 --> 00:33:23,369
ABOUT RICH DEVELOPERS
1194
00:33:23,369 --> 00:33:25,071
WHO BUILT EMPTY OFFICE BUILDINGS
1195
00:33:25,071 --> 00:33:26,072
THAT MADE NO SENSE
1196
00:33:26,072 --> 00:33:27,439
FROM AN ECONOMIC PERSPECTIVE
1197
00:33:27,439 --> 00:33:29,075
BUT SAVED THEM AN ENORMOUS
1198
00:33:29,075 --> 00:33:30,476
AMOUNT OF MONEY IN TAXES,
1199
00:33:30,476 --> 00:33:31,477
AND PEOPLE SAW THAT
1200
00:33:31,477 --> 00:33:32,478
AS JUST A TRAVESTY.
1201
00:33:32,478 --> 00:33:33,645
THEY THOUGHT IT WAS UNFAIR
1202
00:33:33,645 --> 00:33:35,081
RICH PEOPLE WERE GETTING AWAY
1203
00:33:35,081 --> 00:33:36,448
WITH MURDER, AND THEY UNDERSTOOD
1204
00:33:36,448 --> 00:33:37,449
THAT THE TAX SYSTEM
1205
00:33:37,449 --> 00:33:38,450
WAS UNRAVELING.
1206
00:33:38,450 --> 00:33:39,718
>> YOU COULD ACTUALLY SELL
1207
00:33:39,718 --> 00:33:41,153
TAX CREDITS-- BUSINESSES
1208
00:33:41,153 --> 00:33:42,254
COULD SELL INVESTMENT
1209
00:33:42,254 --> 00:33:43,555
TAX CREDITS THEY DIDN'T NEED.
1210
00:33:43,555 --> 00:33:44,556
THERE WAS A MARKET
1211
00:33:44,556 --> 00:33:45,824
IN THE WALL STREET JOURNAL.
1212
00:33:45,824 --> 00:33:47,126
YOU COULD BUY THE RIGHT
1213
00:33:47,126 --> 00:33:48,394
NOT TO PAY TAXES.
1214
00:33:48,394 --> 00:33:49,395
>> WE HAD A SITUATION
1215
00:33:49,395 --> 00:33:50,462
WHERE HALF OF
1216
00:33:50,462 --> 00:33:51,797
OUR BIG CORPORATIONS WEREN'T
1217
00:33:51,797 --> 00:33:54,133
PAYING ANY TAXES, AND MANY OF
1218
00:33:54,133 --> 00:33:55,767
THE OTHER ONES, THE OTHER HALF,
1219
00:33:55,767 --> 00:33:57,469
WERE PAYING QUITE A BIT.
1220
00:33:57,469 --> 00:33:59,605
>> REAGAN CAME TO BELIEVE
1221
00:33:59,605 --> 00:34:01,707
THAT THIS REALLY WASN'T RIGHT,
1222
00:34:01,707 --> 00:34:03,542
AND, UH, HE WAS A MAN
1223
00:34:03,542 --> 00:34:05,244
OF CERTAIN VERY STRONG
1224
00:34:05,244 --> 00:34:06,245
CONVICTIONS.
1225
00:34:06,245 --> 00:34:07,479
SO HE SAID TO HIS SECRETARY
1226
00:34:07,479 --> 00:34:09,615
OF THE TREASURY IN 1984,
1227
00:34:09,615 --> 00:34:11,383
"COME UP WITH A PROPOSAL
1228
00:34:11,383 --> 00:34:12,518
THAT VASTLY SIMPLIFIES
1229
00:34:12,518 --> 00:34:13,585
THE LAWS, THAT'S FAIR
1230
00:34:13,585 --> 00:34:14,853
TO EVERYBODY, THAT DOESN'T
1231
00:34:14,853 --> 00:34:17,089
REALLY RAISE MORE REVENUE,
1232
00:34:17,089 --> 00:34:18,824
BUT DOES IT IN A SENSIBLE,
1233
00:34:18,824 --> 00:34:19,825
ECONOMICALLY SOUND
1234
00:34:19,825 --> 00:34:22,294
AND FAIR WAY, AND THAT MAKES
1235
00:34:22,294 --> 00:34:24,496
THE TAX LAWS MORE TRANSPARENT."
1236
00:34:24,496 --> 00:34:25,664
>> REAGAN DIDN'T PUT A LOT
1237
00:34:25,664 --> 00:34:26,798
OF PRECONDITIONS ON IT.
1238
00:34:26,798 --> 00:34:27,866
HE SAID, "I WANT LOWER
1239
00:34:27,866 --> 00:34:28,867
MARGINAL TAX RATES,
1240
00:34:28,867 --> 00:34:30,469
AND I'M GONNA KEEP THE TAX BREAK
1241
00:34:30,469 --> 00:34:31,703
FOR MORTGAGE INTEREST."
1242
00:34:31,703 --> 00:34:33,705
HE THOUGHT THAT WAS SACROSANCT.
1243
00:34:33,705 --> 00:34:35,241
BASICALLY, EVERYTHING ELSE
1244
00:34:35,241 --> 00:34:36,308
WAS ON THE TABLE.
1245
00:34:36,308 --> 00:34:37,709
>> ONCE TAX REFORM IS OUT THERE,
1246
00:34:37,709 --> 00:34:38,710
ANYONE WHO KILLS IT,
1247
00:34:38,710 --> 00:34:39,711
THE SAYING WAS,
1248
00:34:39,711 --> 00:34:40,712
HE HAS A DEAD CAT
1249
00:34:40,712 --> 00:34:42,148
ON HIS DOORSTEP.
1250
00:34:42,148 --> 00:34:43,482
ANYONE WHO KILLED TAX REFORM
1251
00:34:43,482 --> 00:34:45,184
WAS IMMEDIATELY UNDER SUSPICION,
1252
00:34:45,184 --> 00:34:46,352
HAVING DONE IT AS SOME SORT
1253
00:34:46,352 --> 00:34:47,353
OF SLEAZY PAYOFF
1254
00:34:47,353 --> 00:34:48,520
TO THE INTEREST GROUPS--
1255
00:34:48,520 --> 00:34:49,855
WHICH, IT'S TRUE ENOUGH,
1256
00:34:49,855 --> 00:34:51,190
HATED IT-- SO REAGAN HAS
1257
00:34:51,190 --> 00:34:52,258
THIS RISK OF A DEAD CAT
1258
00:34:52,258 --> 00:34:53,292
ON HIS DOORSTEP.
1259
00:34:53,292 --> 00:34:54,560
HE-- I THINK HE GENUINELY
1260
00:34:54,560 --> 00:34:56,362
BELIEVED AND WANTED TO DO IT,
1261
00:34:56,362 --> 00:34:57,563
BUT HE IS SORT OF FORCED
1262
00:34:57,563 --> 00:34:58,664
POLITICALLY TO COME UP
1263
00:34:58,664 --> 00:35:00,266
WITH A PLAN THAT'S MORE FEASIBLE
1264
00:35:00,266 --> 00:35:01,667
THAN THE PURE TREASURY ONE PLAN.
1265
00:35:01,667 --> 00:35:02,834
THEN IT GOES TO THE HOUSE,
1266
00:35:02,834 --> 00:35:04,403
WHERE-- OF REPRESENTATIVES,
1267
00:35:04,403 --> 00:35:06,138
WHERE CONGRESSMAN ROSTENKOWSKI,
1268
00:35:06,138 --> 00:35:07,206
THE DEMOCRATIC CHAIR
1269
00:35:07,206 --> 00:35:08,674
OF THE WAYS AND MEANS COMMITTEE,
1270
00:35:08,674 --> 00:35:10,676
HE HAS TO DO SOMETHING, TOO.
1271
00:35:10,676 --> 00:35:12,811
>> ( shouting, cat yowls )
1272
00:35:12,811 --> 00:35:14,346
>> THE HOUSE PLAN, ACTUALLY,
1273
00:35:14,346 --> 00:35:15,347
THEY RESTORED A LOT
1274
00:35:15,347 --> 00:35:16,548
OF THE SPECIAL TAX BREAKS
1275
00:35:16,548 --> 00:35:17,783
AND THE RATES WENT BACK UP.
1276
00:35:17,783 --> 00:35:19,418
REAGAN ORIGINALLY HAD PROPOSED
1277
00:35:19,418 --> 00:35:21,287
A TOP RATE OF 35%.
1278
00:35:21,287 --> 00:35:22,421
THE RATE WAS EVEN HIGHER
1279
00:35:22,421 --> 00:35:23,422
IN THE HOUSE PLAN,
1280
00:35:23,422 --> 00:35:24,690
AND IT-- AND THEY RESTORED
1281
00:35:24,690 --> 00:35:26,558
A LOT OF THE SPECIAL TAX BREAKS.
1282
00:35:26,558 --> 00:35:28,427
>> IT WAS A TAX REFORM PROPOSAL
1283
00:35:28,427 --> 00:35:29,695
THAT DIED, FRANKLY,
1284
00:35:29,695 --> 00:35:31,430
LEGISLATIVELY, NUMEROUS TIMES,
1285
00:35:31,430 --> 00:35:32,764
AND RONALD REAGAN HAD TO REACH
1286
00:35:32,764 --> 00:35:34,166
INTO THE CONGRESS AND SAY,
1287
00:35:34,166 --> 00:35:35,501
"NO, WE HAVE TO FINISH
1288
00:35:35,501 --> 00:35:36,768
OUR JOB HERE,"
1289
00:35:36,768 --> 00:35:39,305
AND WOULD RESURRECT TAX REFORM.
1290
00:35:39,305 --> 00:35:40,172
>> Shaviro: THEN IT GOES
1291
00:35:40,172 --> 00:35:40,839
TO THE SENATE,
1292
00:35:40,839 --> 00:35:41,707
TO SENATOR PACKWOOD
1293
00:35:41,707 --> 00:35:42,774
OF THE SENATE FINANCE COMMITTEE.
1294
00:35:42,774 --> 00:35:44,310
INITIALLY, I THINK IT'S FAIR
1295
00:35:44,310 --> 00:35:45,711
TO SAY HE REALLY HATED IT.
1296
00:35:45,711 --> 00:35:46,712
HE CAME AROUND A BIT,
1297
00:35:46,712 --> 00:35:47,713
BUT PART OF THE THING
1298
00:35:47,713 --> 00:35:48,714
WAS THAT HE WOULD BE
1299
00:35:48,714 --> 00:35:49,815
THE ONE WHO KILLED IT.
1300
00:35:49,815 --> 00:35:50,682
HE DIDN'T WANNA BE
1301
00:35:50,682 --> 00:35:51,550
THE ONE WHO KILLED IT,
1302
00:35:51,550 --> 00:35:52,551
SO HE HAD TO DO SOMETHING ELSE.
1303
00:35:52,551 --> 00:35:53,719
>> PACKWOOD AND HIS STAFF
1304
00:35:53,719 --> 00:35:54,753
CAME UP WITH THE IDEA,
1305
00:35:54,753 --> 00:35:55,754
WHAT THEY CALLED
1306
00:35:55,754 --> 00:35:56,755
THE 27% SOLUTION.
1307
00:35:56,755 --> 00:35:58,290
THEY WOULD TAX CAPITAL GAINS
1308
00:35:58,290 --> 00:35:59,458
THE SAME AS OTHER INCOME.
1309
00:35:59,458 --> 00:36:00,726
BEFORE THAT, CAPITAL GAINS
1310
00:36:00,726 --> 00:36:01,760
HAD ALWAYS BEEN TAXED
1311
00:36:01,760 --> 00:36:02,761
AT A LOWER RATE,
1312
00:36:02,761 --> 00:36:03,862
AND BY ELIMINATING
1313
00:36:03,862 --> 00:36:05,331
A WHOLE HOST OF DEDUCTIONS
1314
00:36:05,331 --> 00:36:06,332
AND TAX BREAKS,
1315
00:36:06,332 --> 00:36:07,433
AND BY PUTTING A BIG TAX
1316
00:36:07,433 --> 00:36:08,734
INCREASE ON CORPORATIONS,
1317
00:36:08,734 --> 00:36:10,336
THEY WERE ABLE TO LOWER
1318
00:36:10,336 --> 00:36:13,205
THE TOP RATE TO 27%.
1319
00:36:13,205 --> 00:36:14,606
WHICH WAS VERY, VERY APPEALING,
1320
00:36:14,606 --> 00:36:15,741
AND REAGAN LIKED IT A LOT.
1321
00:36:15,741 --> 00:36:16,742
>> McIntyre: SO, WE MANAGED
1322
00:36:16,742 --> 00:36:18,210
TO GET A TAX REFORM
1323
00:36:18,210 --> 00:36:19,678
THAT WAS A TERRIFIC DEAL
1324
00:36:19,678 --> 00:36:21,380
FOR LOW- AND MIDDLE-INCOME
1325
00:36:21,380 --> 00:36:23,215
PEOPLE, OVERALL RAISE TAXES
1326
00:36:23,215 --> 00:36:24,750
ON CORPORATIONS AND THE WEALTHY,
1327
00:36:24,750 --> 00:36:25,751
BUT CUT TAXES
1328
00:36:25,751 --> 00:36:26,885
ON ENOUGH WEALTHY PEOPLE
1329
00:36:26,885 --> 00:36:28,287
AND ENOUGH CORPORATIONS
1330
00:36:28,287 --> 00:36:30,489
TO KEEP THOSE LOBBYING FORCES
1331
00:36:30,489 --> 00:36:32,224
AT BAY.
1332
00:36:32,224 --> 00:36:33,225
>> Fox: THEY ELIMINATED
1333
00:36:33,225 --> 00:36:34,226
ABOUT A THIRD OF ALL
1334
00:36:34,226 --> 00:36:35,694
THE SPECIAL RELIEF PROVISIONS.
1335
00:36:35,694 --> 00:36:36,962
THEY BROUGHT TAX RATES DOWN
1336
00:36:36,962 --> 00:36:37,996
FOR EVERYBODY.
1337
00:36:37,996 --> 00:36:40,599
ONLY... PEOPLE SAID,
1338
00:36:40,599 --> 00:36:41,933
"NOT GONNA LAST,"
1339
00:36:41,933 --> 00:36:44,603
BECAUSE PROVIDING TAX RELIEF
1340
00:36:44,603 --> 00:36:45,604
IS SO MUCH A PART
1341
00:36:45,604 --> 00:36:47,439
OF THE POLITICAL CAMPAIGNS.
1342
00:36:47,439 --> 00:36:48,507
"WHAT CAN I OFFER PEOPLE
1343
00:36:48,507 --> 00:36:49,675
THAT WILL MAKE THEM THINK
1344
00:36:49,675 --> 00:36:50,576
I'M FOR THEM?"
1345
00:36:53,612 --> 00:36:55,881
>> ( G.H.W. Bush speaking )
1346
00:37:00,552 --> 00:37:03,655
>> ( cheering )
1347
00:37:03,655 --> 00:37:05,824
>> ( Clinton speaking )
1348
00:37:10,629 --> 00:37:12,564
...THE OLD-FASHIONED WAY.
1349
00:37:12,564 --> 00:37:15,401
>> ( G.W. Bush speaking )
1350
00:37:19,405 --> 00:37:23,375
>> ( Obama speaking )
1351
00:37:23,375 --> 00:37:24,376
...UNDER MY PLAN...
1352
00:37:24,376 --> 00:37:26,812
>> ( cheering )
1353
00:37:39,425 --> 00:37:40,626
>> BY THE ELEMENTS ALONE,
1354
00:37:40,626 --> 00:37:41,860
THEY WILL GROW TO MILLIONS
1355
00:37:41,860 --> 00:37:43,429
OF TIMES THEIR ORIGINAL SIZE
1356
00:37:43,429 --> 00:37:44,930
IN LESS TIME THAN IT TAKES
1357
00:37:44,930 --> 00:37:47,766
FOR THE SUN TO RISE AND FALL.
1358
00:37:53,805 --> 00:37:55,073
>> Mitchell: THE TAX SYSTEM
1359
00:37:55,073 --> 00:37:57,343
HAS BECOME A BIT OF A PLAYPEN
1360
00:37:57,343 --> 00:37:58,344
FOR POLITICIANS
1361
00:37:58,344 --> 00:37:59,345
OF BOTH PARTIES.
1362
00:37:59,345 --> 00:38:00,746
WHETHER THEY'RE REPUBLICANS
1363
00:38:00,746 --> 00:38:02,414
OR DEMOCRATS, IT SEEMS LIKE
1364
00:38:02,414 --> 00:38:04,516
FOR EVERY REAL OR IMAGINED
1365
00:38:04,516 --> 00:38:06,051
PROBLEM IN THE COUNTRY,
1366
00:38:06,051 --> 00:38:08,320
SOME POLITICIAN HAS AN ANSWER
1367
00:38:08,320 --> 00:38:09,821
THAT INVOLVES MORE COMPLICATION
1368
00:38:09,821 --> 00:38:10,856
OF THE TAX CODE.
1369
00:38:10,856 --> 00:38:12,391
>> WHAT YOU ARE LOOKING AT NOW
1370
00:38:12,391 --> 00:38:13,492
USED TO BE A GREAT CITY.
1371
00:38:13,492 --> 00:38:14,926
THAT WAS LONG AGO.
1372
00:38:14,926 --> 00:38:16,528
>> GEE!
1373
00:38:16,528 --> 00:38:17,929
>> IT'S THE HOME
1374
00:38:17,929 --> 00:38:19,731
OF MONSTERS NOW.
1375
00:38:19,731 --> 00:38:20,999
>> OUR TAX SYSTEM, IN THE WAY
1376
00:38:20,999 --> 00:38:22,368
IT'S USED BY GOVERNMENT,
1377
00:38:22,368 --> 00:38:23,369
IT'S BASICALLY
1378
00:38:23,369 --> 00:38:24,870
A VOTE-BUYING SYSTEM.
1379
00:38:24,870 --> 00:38:26,004
IT IS USED TO CURRY FAVOR
1380
00:38:26,004 --> 00:38:27,639
WITH VOTERS.
1381
00:38:27,639 --> 00:38:28,640
>> Burman: POLITICIANS
1382
00:38:28,640 --> 00:38:29,741
IN BOTH PARTIES HAVE COME
1383
00:38:29,741 --> 00:38:30,742
TO SEE THE INCOME TAX
1384
00:38:30,742 --> 00:38:32,744
AS A KIND OF CHRISTMAS TREE
1385
00:38:32,744 --> 00:38:33,879
FULL OF GOODIES THEY CAN
1386
00:38:33,879 --> 00:38:35,481
GIVE AWAY FOR ONE CONSTITUENCY
1387
00:38:35,481 --> 00:38:36,815
OR ANOTHER, AND THERE'S BEEN
1388
00:38:36,815 --> 00:38:38,450
THIS BIPARTISAN CONSENSUS
1389
00:38:38,450 --> 00:38:40,352
THAT THE WAY TO PANDER
1390
00:38:40,352 --> 00:38:41,353
TO THE ELECTORATE
1391
00:38:41,353 --> 00:38:42,754
IS BY CREATING NEW TAX CREDITS
1392
00:38:42,754 --> 00:38:44,590
TARGETED AT PARTICULAR GROUPS.
1393
00:38:44,590 --> 00:38:45,457
>> ( growls )
1394
00:38:45,457 --> 00:38:46,458
>> IT'S THAT MONSTER AGAIN!
1395
00:38:46,458 --> 00:38:47,459
>> AND WE CAN CONTROL
1396
00:38:47,459 --> 00:38:48,494
HIS ACTIONS, DON'T WORRY.
1397
00:38:48,494 --> 00:38:49,495
>> WHY THE TAX CODE?
1398
00:38:49,495 --> 00:38:50,729
WHY NOT JUST SEND THE MONEY
1399
00:38:50,729 --> 00:38:51,730
OUT IN A CHECK?
1400
00:38:51,730 --> 00:38:53,565
WELL, THINGS GET HIDDEN
1401
00:38:53,565 --> 00:38:54,566
IN THE TAX CODE,
1402
00:38:54,566 --> 00:38:55,634
AND YOU GET CREDIT
1403
00:38:55,634 --> 00:38:56,868
FOR TWO THINGS WHEN YOU PUT
1404
00:38:56,868 --> 00:38:58,504
A SUBSIDY-- A SPECIAL
1405
00:38:58,504 --> 00:38:59,805
TAX BREAK INTO THE TAX CODE.
1406
00:38:59,805 --> 00:39:01,840
A), YOU GET CREDIT
1407
00:39:01,840 --> 00:39:02,908
FOR THE SUBSIDY,
1408
00:39:02,908 --> 00:39:05,110
AND B), YOU'VE CUT TAXES.
1409
00:39:05,110 --> 00:39:06,645
SO YOU DIDN'T INCREASE
1410
00:39:06,645 --> 00:39:07,646
GOVERNMENT SPENDING,
1411
00:39:07,646 --> 00:39:08,647
YOU CUT TAXES,
1412
00:39:08,647 --> 00:39:10,048
AND, WOW, THAT'S A TWOFER.
1413
00:39:10,048 --> 00:39:11,383
>> I DON'T UNDERSTAND.
1414
00:39:11,383 --> 00:39:12,384
WHY DO YOU HAVE
1415
00:39:12,384 --> 00:39:13,819
SUCH MONSTERS ANYWAY?
1416
00:39:13,819 --> 00:39:15,721
YOU'RE SO ADVANCED AND ALL.
1417
00:39:15,721 --> 00:39:16,722
>> Sheppard: CONGRESSPEOPLE
1418
00:39:16,722 --> 00:39:17,789
HAVE TO LOOK LIKE
1419
00:39:17,789 --> 00:39:20,526
THEY'RE DOING SOMETHING.
1420
00:39:20,526 --> 00:39:21,927
THERE'S-- THE WHOLE IMPETUS
1421
00:39:21,927 --> 00:39:23,729
IN WASHINGTON IS TO,
1422
00:39:23,729 --> 00:39:25,130
YOU KNOW, AS BILL CLINTON
1423
00:39:25,130 --> 00:39:26,131
USED TO PUT IT,
1424
00:39:26,131 --> 00:39:28,400
FEEL YOUR PAIN, YOU KNOW?
1425
00:39:28,400 --> 00:39:29,401
"LET'S GIVE 'EM
1426
00:39:29,401 --> 00:39:31,169
A LITTLE TAX CREDIT FOR IT,
1427
00:39:31,169 --> 00:39:32,471
AND IT'S NOT GONNA MAKE
1428
00:39:32,471 --> 00:39:33,705
A DENT IN THE REAL PROBLEM,
1429
00:39:33,705 --> 00:39:34,840
BUT IT'S GONNA LOOK LIKE
1430
00:39:34,840 --> 00:39:36,442
WE'RE DOING SOMETHING."
1431
00:39:36,442 --> 00:39:37,443
>> WELL, NOW, WHERE DO YOU THINK
1432
00:39:37,443 --> 00:39:38,444
THIS COUNTRY WOULD BE
1433
00:39:38,444 --> 00:39:39,445
WITHOUT POLITICIANS?
1434
00:39:39,445 --> 00:39:40,779
DO YOU THINK THAT THE AVERAGE
1435
00:39:40,779 --> 00:39:41,980
CITIZEN WOULD TAKE TIME OFF
1436
00:39:41,980 --> 00:39:43,081
TO HELP RUN THE COUNTRY?
1437
00:39:43,081 --> 00:39:44,550
>> THERE ARE MANY WHO WOULD.
1438
00:39:44,550 --> 00:39:45,951
>> AHH! ALL THE AVERAGE CITIZEN
1439
00:39:45,951 --> 00:39:47,553
THINKS ABOUT IS MAKING MONEY.
1440
00:39:47,553 --> 00:39:49,655
HE'S GOT NO TIME FOR POLITICS.
1441
00:39:49,655 --> 00:39:50,956
>> THE PUBLIC IS BEING TAUGHT
1442
00:39:50,956 --> 00:39:53,625
THAT TO PAY TAXES IS PAINFUL.
1443
00:39:53,625 --> 00:39:55,093
THAT'S WHY YOU NEED,
1444
00:39:55,093 --> 00:39:56,094
QUOTE, RELIEF.
1445
00:39:56,094 --> 00:39:57,696
IT'S AN AFFLICTION,
1446
00:39:57,696 --> 00:39:58,797
AND IF YOU CAN MITIGATE
1447
00:39:58,797 --> 00:39:59,798
THAT IN SOME WAY,
1448
00:39:59,798 --> 00:40:01,433
IF POLITICIANS CAN OFFER YOU
1449
00:40:01,433 --> 00:40:02,968
JUST SOME MORE RELIEF FROM THAT,
1450
00:40:02,968 --> 00:40:04,803
YOU'LL BE BETTER OFF.
1451
00:40:04,803 --> 00:40:06,071
>> WE FOUND, TO OUR REGRET,
1452
00:40:06,071 --> 00:40:07,773
THAT IT MADE UNCONTROLLABLE
1453
00:40:07,773 --> 00:40:09,608
MONSTERS, AS WELL.
1454
00:40:09,608 --> 00:40:10,742
>> THE TAX SYSTEM HAS NOW
1455
00:40:10,742 --> 00:40:11,743
GOTTEN TO THE POINT
1456
00:40:11,743 --> 00:40:12,744
WHERE CONGRESS USES
1457
00:40:12,744 --> 00:40:13,745
THE TAX SYSTEM
1458
00:40:13,745 --> 00:40:14,746
THE WAY MY MOTHER
1459
00:40:14,746 --> 00:40:16,114
USED CHICKEN SOUP.
1460
00:40:16,114 --> 00:40:18,584
IT'S A CURE-ALL FOR ANY ILL
1461
00:40:18,584 --> 00:40:19,585
AFFECTING SOCIETY
1462
00:40:19,585 --> 00:40:20,619
OR THE ECONOMY.
1463
00:40:20,619 --> 00:40:21,653
>> Burman: YOU COULD PICK
1464
00:40:21,653 --> 00:40:22,788
ALMOST ANY PROGRAM AREA
1465
00:40:22,788 --> 00:40:25,123
YOU WANT-- THERE'S A TAX PROGRAM
1466
00:40:25,123 --> 00:40:26,191
THAT LOOKS BASICALLY
1467
00:40:26,191 --> 00:40:27,693
LIKE A GOVERNMENT PROGRAM
1468
00:40:27,693 --> 00:40:28,694
RUN BY AN AGENCY,
1469
00:40:28,694 --> 00:40:29,695
BUT IT'S RUN BY
1470
00:40:29,695 --> 00:40:30,829
THE IRS, INSTEAD.
1471
00:40:30,829 --> 00:40:32,230
>> YOU KNOW, THE LITTLE CREDITS
1472
00:40:32,230 --> 00:40:33,832
FOR THIS AND THAT ARE OFFENSIVE
1473
00:40:33,832 --> 00:40:36,735
BECAUSE THEY DON'T WORK.
1474
00:40:36,735 --> 00:40:38,003
YOU KNOW, THEY COST MONEY,
1475
00:40:38,003 --> 00:40:39,137
AND THEY DON'T WORK.
1476
00:40:39,137 --> 00:40:42,240
THAT'S NOT A GOOD COMBINATION.
1477
00:40:42,240 --> 00:40:45,977
>> ( screaming )
1478
00:40:45,977 --> 00:40:47,579
>> THE GENERAL PRINCIPLE,
1479
00:40:47,579 --> 00:40:48,580
I THINK, YOU DERIVE
1480
00:40:48,580 --> 00:40:50,048
FROM MOST TAX RELIEF
1481
00:40:50,048 --> 00:40:51,850
IS THAT THE MOST RELIEF
1482
00:40:51,850 --> 00:40:52,851
GOES TO PEOPLE
1483
00:40:52,851 --> 00:40:54,586
WHO NEED IT THE LEAST;
1484
00:40:54,586 --> 00:40:56,221
THE LEAST RELIEF GOES TO PEOPLE
1485
00:40:56,221 --> 00:40:57,623
WHO NEED IT THE MOST.
1486
00:40:57,623 --> 00:40:59,758
>> SURVEY SHOWS AMERICAN PEOPLE
1487
00:40:59,758 --> 00:41:00,759
TODAY BETTER HOUSED
1488
00:41:00,759 --> 00:41:02,728
THAN ANY PEOPLE IN HISTORY.
1489
00:41:02,728 --> 00:41:03,762
WHEN I FIRST READ THAT
1490
00:41:03,762 --> 00:41:04,963
ON THE RELEASE, I THOUGHT
1491
00:41:04,963 --> 00:41:06,698
TO MYSELF, "THEY CALL THAT NEWS?
1492
00:41:06,698 --> 00:41:08,500
EVERYONE KNOWS THAT!"
1493
00:41:08,500 --> 00:41:10,068
>> Fox: NOW, I WRITE
1494
00:41:10,068 --> 00:41:11,537
AND HAVE TALKED A LOT ABOUT
1495
00:41:11,537 --> 00:41:12,638
HOW THE HOME MORTGAGE
1496
00:41:12,638 --> 00:41:13,639
INTEREST DEDUCTION
1497
00:41:13,639 --> 00:41:14,773
IS SOMETHING SACRED.
1498
00:41:14,773 --> 00:41:16,174
I MEAN, IT'S A THIRD RAIL.
1499
00:41:16,174 --> 00:41:18,544
NO CANDIDATE IS GOING TO SAY
1500
00:41:18,544 --> 00:41:19,811
THAT WE OUGHT TO ELIMINATE IT
1501
00:41:19,811 --> 00:41:20,879
OR GREATLY CURTAIL IT.
1502
00:41:20,879 --> 00:41:21,913
I THINK THAT THE QUESTION
1503
00:41:21,913 --> 00:41:22,914
THAT YOU'D ASK
1504
00:41:22,914 --> 00:41:23,982
FOR THE HOME MORTGAGE INTEREST
1505
00:41:23,982 --> 00:41:25,216
DEDUCTION IS THE QUESTION
1506
00:41:25,216 --> 00:41:26,618
YOU'D ASK FOR ALL RELIEF:
1507
00:41:26,618 --> 00:41:27,953
WHY IS IT THERE?
1508
00:41:27,953 --> 00:41:29,187
>> THE PROOF OF THE PUDDING
1509
00:41:29,187 --> 00:41:31,990
IS IN THE EATING, AS THEY SAY,
1510
00:41:31,990 --> 00:41:34,025
AND THAT PARTICULAR KIND
1511
00:41:34,025 --> 00:41:36,194
OF PUDDING TASTES
1512
00:41:36,194 --> 00:41:38,697
RIGHT NICE TO US.
1513
00:41:38,697 --> 00:41:42,100
>> IN 2006, THE BOTTOM 52%
1514
00:41:42,100 --> 00:41:45,571
OF ALL TAXPAYERS, OVER 50%,
1515
00:41:45,571 --> 00:41:46,938
THEY GOT JUST 2%
1516
00:41:46,938 --> 00:41:48,840
OF THAT 66 BILLION.
1517
00:41:48,840 --> 00:41:52,944
THE TOP 3% GOT ABOUT 30%.
1518
00:41:52,944 --> 00:41:54,946
WELL, CAN YOU IMAGINE
1519
00:41:54,946 --> 00:41:57,583
IN THIS SENATE FINANCE COMMITTEE
1520
00:41:57,583 --> 00:41:58,917
HEARING SAYING, "WE ARE NOW
1521
00:41:58,917 --> 00:42:00,919
ANNOUNCING" JUST THAT OUTCOME?
1522
00:42:00,919 --> 00:42:02,721
"WE'RE GONNA GIVE 30%
1523
00:42:02,721 --> 00:42:03,922
TO THE TOP THREE OF YOU,
1524
00:42:03,922 --> 00:42:06,024
AND THE OTHER 52%,
1525
00:42:06,024 --> 00:42:07,092
WHY DON'T YOU JUST GET
1526
00:42:07,092 --> 00:42:08,093
OUT OF THE MEETING?
1527
00:42:08,093 --> 00:42:10,261
GO HOME, 'CAUSE WE DON'T CARE
1528
00:42:10,261 --> 00:42:12,831
TO HELP YOU BECOME HOMEOWNERS,"
1529
00:42:12,831 --> 00:42:13,832
AND THAT WOULD BE OUTRAGEOUS.
1530
00:42:13,832 --> 00:42:14,833
IT COULDN'T HAPPEN,
1531
00:42:14,833 --> 00:42:15,834
BUT IT DOES HAPPEN
1532
00:42:15,834 --> 00:42:17,235
IN THE TAX LAWS, AND SO MANY
1533
00:42:17,235 --> 00:42:18,336
OF THOSE THINGS OCCUR
1534
00:42:18,336 --> 00:42:20,238
BECAUSE IT'S NOT TRANSPARENT.
1535
00:42:20,238 --> 00:42:22,007
AND POLITICIANS
1536
00:42:22,007 --> 00:42:23,241
DON'T WANT TO TALK ABOUT IT,
1537
00:42:23,241 --> 00:42:24,576
BECAUSE THEY TALK ABOUT
1538
00:42:24,576 --> 00:42:25,577
HOW MARVELOUS IS IT
1539
00:42:25,577 --> 00:42:26,878
TO HELP YOU OWN A HOME.
1540
00:42:26,878 --> 00:42:27,746
>> Man: HOMES THAT ARE
1541
00:42:27,746 --> 00:42:28,847
THE FINEST THAT CAN BE HAD
1542
00:42:28,847 --> 00:42:29,848
FOR THE MEANS
1543
00:42:29,848 --> 00:42:30,849
AND THE MODE OF LIFE
1544
00:42:30,849 --> 00:42:33,652
OF THOSE WHO LOVE, HOPE,
1545
00:42:33,652 --> 00:42:35,587
SLEEP, WORK, EAT...
1546
00:42:35,587 --> 00:42:37,155
YES, LIVE IN THEM
1547
00:42:37,155 --> 00:42:39,825
FOR AMERICA.
1548
00:42:39,825 --> 00:42:41,059
>> THE CHILDCARE CREDIT.
1549
00:42:41,059 --> 00:42:42,327
I MEAN, CHILDCARE
1550
00:42:42,327 --> 00:42:44,362
IS EXPENSIVE FOR EVERYBODY.
1551
00:42:44,362 --> 00:42:45,864
IT'S INCREDIBLY EXPENSIVE.
1552
00:42:45,864 --> 00:42:46,998
YOU HAVE TO-- IF YOU HAVE
1553
00:42:46,998 --> 00:42:47,999
ONE CHILD, LET ALONE
1554
00:42:47,999 --> 00:42:49,300
TWO CHILDREN IN CHILDCARE...
1555
00:42:49,300 --> 00:42:50,936
AND SO CONGRESS ENACTED
1556
00:42:50,936 --> 00:42:52,638
A CHILDCARE CREDIT.
1557
00:42:52,638 --> 00:42:54,773
WELL, WHO GETS IT?
1558
00:42:54,773 --> 00:42:56,307
WELL, YOU ONLY GET A CREDIT,
1559
00:42:56,307 --> 00:42:57,876
WHICH IS A DOLLAR-FOR-DOLLAR
1560
00:42:57,876 --> 00:42:59,210
CREDIT AGAINST YOUR TAXES--
1561
00:42:59,210 --> 00:43:00,779
IT OFFSETS A DOLLAR OF TAXES--
1562
00:43:00,779 --> 00:43:03,148
IF YOU OWE TAXES.
1563
00:43:03,148 --> 00:43:04,149
BUT LISTEN TO THIS--
1564
00:43:04,149 --> 00:43:06,251
AND IT JUST SEEMS SO STRIKING,
1565
00:43:06,251 --> 00:43:07,753
THE UNFAIR--
1566
00:43:07,753 --> 00:43:08,754
IF YOU EARN HUNDREDS
1567
00:43:08,754 --> 00:43:10,021
OF THOUSANDS, OR MILLIONS
1568
00:43:10,021 --> 00:43:11,156
OF DOLLARS, AND YOU HAVE
1569
00:43:11,156 --> 00:43:12,190
TWO KIDS IN CHILDCARE
1570
00:43:12,190 --> 00:43:13,391
AND YOU'RE THE EXECUTIVE
1571
00:43:13,391 --> 00:43:15,226
OF SOME TOP COMPANY,
1572
00:43:15,226 --> 00:43:18,196
YOU GET THE $1200 TAX CREDIT.
1573
00:43:18,196 --> 00:43:20,298
IF YOU EARN $25,000
1574
00:43:20,298 --> 00:43:22,634
AND YOU DON'T OWE INCOME TAXES,
1575
00:43:22,634 --> 00:43:24,770
YOU DON'T GET ANY HELP,
1576
00:43:24,770 --> 00:43:25,771
YET YOU'RE THE ONES
1577
00:43:25,771 --> 00:43:27,673
WHO NEED THE HELP THE MOST.
1578
00:43:27,673 --> 00:43:29,040
>> THAT'S THE KIND OF BUSINESS
1579
00:43:29,040 --> 00:43:30,341
WE LIKE.
1580
00:43:30,341 --> 00:43:31,409
>> THESE ARE OUTCOMES
1581
00:43:31,409 --> 00:43:32,744
THAT, IF THEY DON'T MAKE
1582
00:43:32,744 --> 00:43:34,012
SOCIAL SENSE, IF THEY DON'T
1583
00:43:34,012 --> 00:43:35,046
MAKE ECONOMIC SENSE,
1584
00:43:35,046 --> 00:43:37,182
AND THEY DRIVE UP TAX RATES,
1585
00:43:37,182 --> 00:43:38,850
WE OUGHT TO SAY
1586
00:43:38,850 --> 00:43:39,851
TO OUR POLITICIANS,
1587
00:43:39,851 --> 00:43:43,021
AND I'M ASKING THEM, "WHY?"
1588
00:43:43,021 --> 00:43:44,155
>> ALL RIGHT, ALL RIGHT,
1589
00:43:44,155 --> 00:43:45,724
HOLD OFF THE QUESTIONS.
1590
00:43:45,724 --> 00:43:47,893
>> WHY THE MYSTERY, BILL?
1591
00:43:47,893 --> 00:43:49,294
>> RIGHT NOW WE HAVE TAX CREDITS
1592
00:43:49,294 --> 00:43:50,295
FOR BABY-SITTERS,
1593
00:43:50,295 --> 00:43:51,429
TAX CREDITS FOR COLLEGE,
1594
00:43:51,429 --> 00:43:53,865
YOU KNOW, TAX CREDITS FOR KIDS,
1595
00:43:53,865 --> 00:43:55,233
AND, YOU KNOW, THIS IS
1596
00:43:55,233 --> 00:43:56,802
THE KIND OF JUNK
1597
00:43:56,802 --> 00:43:58,937
THAT MAKES THE TAX CODE
1598
00:43:58,937 --> 00:44:00,105
TENS OF THOUSANDS
1599
00:44:00,105 --> 00:44:01,106
OF PAGES LONG.
1600
00:44:01,106 --> 00:44:02,107
IT'S THE KIND OF JUNK
1601
00:44:02,107 --> 00:44:03,942
THAT CREATES THE FIELD DAY
1602
00:44:03,942 --> 00:44:04,943
FOR THE POLITICIANS
1603
00:44:04,943 --> 00:44:06,077
AND THE TAX LAWYERS
1604
00:44:06,077 --> 00:44:07,813
TO PLAY THEIR GAMES.
1605
00:44:07,813 --> 00:44:08,814
>> IT'S JUST NOT CLEAR
1606
00:44:08,814 --> 00:44:09,815
THAT YOU SHOULD REALLY
1607
00:44:09,815 --> 00:44:10,816
BE USING THE TAX SYSTEM
1608
00:44:10,816 --> 00:44:11,917
TO ENCOURAGE HOME OWNERSHIP,
1609
00:44:11,917 --> 00:44:12,918
OR ANYTHING ELSE LIKE THAT.
1610
00:44:12,918 --> 00:44:13,919
>> THE TAX SYSTEM
1611
00:44:13,919 --> 00:44:14,953
SHOULD RAISE REVENUE
1612
00:44:14,953 --> 00:44:15,954
AND THEN TRY TO DO
1613
00:44:15,954 --> 00:44:17,388
AS LITTLE ELSE AS POSSIBLE,
1614
00:44:17,388 --> 00:44:18,957
BECAUSE ALMOST EVERYTHING ELSE
1615
00:44:18,957 --> 00:44:20,892
THAT IT DOES IS HARMFUL.
1616
00:44:28,233 --> 00:44:29,901
>> BUT WHAT PEOPLE DON'T REALIZE
1617
00:44:29,901 --> 00:44:31,369
IS WHILE THE FEDERAL GOVERNMENT
1618
00:44:31,369 --> 00:44:32,470
SPENDS THREE TRILLION
1619
00:44:32,470 --> 00:44:33,739
A YEAR, ROUGHLY,
1620
00:44:33,739 --> 00:44:36,174
IN DIRECT SPENDING PROGRAMS,
1621
00:44:36,174 --> 00:44:39,110
IT ALSO SPENDS INDIRECTLY
1622
00:44:39,110 --> 00:44:41,312
$1 TRILLION A YEAR
1623
00:44:41,312 --> 00:44:42,981
IN TAX PREFERENCES.
1624
00:44:42,981 --> 00:44:44,382
BY THAT I MEAN
1625
00:44:44,382 --> 00:44:46,384
THE FEDERAL GOVERNMENT FORGOES
1626
00:44:46,384 --> 00:44:47,385
RECEIVING REVENUES
1627
00:44:47,385 --> 00:44:49,454
OF ABOUT $1 TRILLION A YEAR
1628
00:44:49,454 --> 00:44:51,256
BECAUSE OF DEDUCTIONS,
1629
00:44:51,256 --> 00:44:53,124
CREDITS, EXEMPTIONS,
1630
00:44:53,124 --> 00:44:55,193
AND EXCLUSIONS IN THE TAX CODE.
1631
00:44:55,193 --> 00:44:56,795
>> WHAT HAPPENS TO THE AVERAGE
1632
00:44:56,795 --> 00:44:58,263
PERSON IS, IF YOU LOOK
1633
00:44:58,263 --> 00:45:00,031
AT THE HUNDREDS,
1634
00:45:00,031 --> 00:45:01,032
IF NOT THOUSANDS
1635
00:45:01,032 --> 00:45:02,167
OF SPECIAL PREFERENCES
1636
00:45:02,167 --> 00:45:03,168
IN THE TAX CODE,
1637
00:45:03,168 --> 00:45:04,903
I BET EVERY SINGLE PERSON
1638
00:45:04,903 --> 00:45:06,204
WATCHING THIS BENEFITS
1639
00:45:06,204 --> 00:45:07,205
FROM ONE OR TWO
1640
00:45:07,205 --> 00:45:08,774
OF THOSE SPECIAL PREFERENCES,
1641
00:45:08,774 --> 00:45:10,141
AND THEY THINK, "WE'D BETTER
1642
00:45:10,141 --> 00:45:11,342
KEEP THE SYSTEM IN PLACE,
1643
00:45:11,342 --> 00:45:12,744
BECAUSE I BENEFIT FROM--
1644
00:45:12,744 --> 00:45:14,212
FROM LOOPHOLE 'A'
1645
00:45:14,212 --> 00:45:16,281
AND LOOPHOLE 'G.'"
1646
00:45:16,281 --> 00:45:18,016
WELL, WHAT THEY DON'T REALIZE
1647
00:45:18,016 --> 00:45:19,117
IS THAT THEIR NEIGHBORS
1648
00:45:19,117 --> 00:45:20,118
ARE BENEFITTING
1649
00:45:20,118 --> 00:45:21,887
FROM LOOPHOLE "E"
1650
00:45:21,887 --> 00:45:23,288
AND LOOPHOLE "L,"
1651
00:45:23,288 --> 00:45:24,522
AND THEN THE NEIGHBOR
1652
00:45:24,522 --> 00:45:26,224
ON THE OTHER SIDE
1653
00:45:26,224 --> 00:45:27,225
IS BENEFITTING
1654
00:45:27,225 --> 00:45:28,259
FROM LOOPHOLE "W"
1655
00:45:28,259 --> 00:45:30,028
AND LOOPHOLE "C."
1656
00:45:30,028 --> 00:45:31,029
AND SO EVERYONE IS,
1657
00:45:31,029 --> 00:45:33,464
IN SOME WAY, HAS THEIR SNOUT
1658
00:45:33,464 --> 00:45:35,133
IN THE TROUGH OF SPECIAL
1659
00:45:35,133 --> 00:45:36,367
INTEREST TAX PROVISIONS,
1660
00:45:36,367 --> 00:45:37,468
BUT WHAT DOES THAT MEAN?
1661
00:45:37,468 --> 00:45:38,536
AT THE END OF THE DAY,
1662
00:45:38,536 --> 00:45:41,940
THE RATE IS HIGHER
1663
00:45:41,940 --> 00:45:42,941
ON ALL OF US
1664
00:45:42,941 --> 00:45:44,542
ON THE INCOME THAT IS TAXED.
1665
00:45:44,542 --> 00:45:45,977
>> YOU SEE THAT ALMOST HALF
1666
00:45:45,977 --> 00:45:47,445
OF ALL INCOME THAT INDIVIDUALS
1667
00:45:47,445 --> 00:45:49,447
COULD BE TAXED ON
1668
00:45:49,447 --> 00:45:51,549
WILL NOT BE TAXED.
1669
00:45:51,549 --> 00:45:53,251
AND PROBABLY PEOPLE WATCHING
1670
00:45:53,251 --> 00:45:55,220
THIS WILL SAY, "WELL, JOHN,
1671
00:45:55,220 --> 00:45:56,221
THAT'S FABULOUS."
1672
00:45:56,221 --> 00:45:58,790
BUT THERE ARE CONSEQUENCES.
1673
00:45:58,790 --> 00:45:59,858
THE FIRST CONSEQUENCE
1674
00:45:59,858 --> 00:46:00,959
IS THAT THERE'S REALLY
1675
00:46:00,959 --> 00:46:02,027
A CLOSE RELATIONSHIP
1676
00:46:02,027 --> 00:46:03,028
BETWEEN TAX RATES
1677
00:46:03,028 --> 00:46:04,495
AND WHAT CAN BE TAXED.
1678
00:46:04,495 --> 00:46:05,496
SO, IF ONLY HALF
1679
00:46:05,496 --> 00:46:06,932
OF ALL INCOME CAN BE TAXED,
1680
00:46:06,932 --> 00:46:07,933
PEOPLE HAVE TO PAY
1681
00:46:07,933 --> 00:46:09,034
MUCH HIGHER TAX RATES
1682
00:46:09,034 --> 00:46:11,236
THAN THEY WOULD OTHERWISE.
1683
00:46:11,236 --> 00:46:12,337
>> WOULDN'T YOU RATHER
1684
00:46:12,337 --> 00:46:14,873
GIVE UP 50 CENTS OF LOOPHOLES
1685
00:46:14,873 --> 00:46:17,175
FOR A DOLLAR OF LOWER TAX RATES?
1686
00:46:17,175 --> 00:46:18,176
THAT'S, IN EFFECT,
1687
00:46:18,176 --> 00:46:21,312
WHAT TAX REFORM IS ALL ABOUT.
1688
00:46:21,312 --> 00:46:22,814
>> SIMPLIFYING THE TAX LAWS,
1689
00:46:22,814 --> 00:46:23,815
MAKING SENSE OF
1690
00:46:23,815 --> 00:46:24,816
THE TAX LAWS,
1691
00:46:24,816 --> 00:46:26,017
THERE ISN'T A POLITICIAN
1692
00:46:26,017 --> 00:46:27,018
WHO WON'T TELL YOU
1693
00:46:27,018 --> 00:46:28,019
THAT THEY'RE FOR IT,
1694
00:46:28,019 --> 00:46:29,120
AND THEN THEY'LL GO OUT
1695
00:46:29,120 --> 00:46:30,521
AND SAY, "AND WHAT I'M OFFERING
1696
00:46:30,521 --> 00:46:31,522
NOW IS A CREDIT HERE,
1697
00:46:31,522 --> 00:46:33,191
AN ADDITIONAL DEDUCTION HERE."
1698
00:46:33,191 --> 00:46:35,226
NOBODY WANTS TO ELIMINATE
1699
00:46:35,226 --> 00:46:36,962
THE RELIEF THAT'S ALREADY THERE.
1700
00:46:36,962 --> 00:46:38,396
ALMOST NO ONE.
1701
00:46:38,396 --> 00:46:40,899
SO, THE POLITICIANS
1702
00:46:40,899 --> 00:46:43,168
ALL ARE FOR DECENCY,
1703
00:46:43,168 --> 00:46:44,402
HONESTY IN THE TAX SYSTEM,
1704
00:46:44,402 --> 00:46:46,938
SIMPLIFICATION, TRANSPARENCY...
1705
00:46:46,938 --> 00:46:48,239
YOU'LL HEAR THAT, AND YOU'LL
1706
00:46:48,239 --> 00:46:49,507
SAY, "OH, THAT'S SOMEBODY
1707
00:46:49,507 --> 00:46:50,508
I'M IN FAVOR OF,"
1708
00:46:50,508 --> 00:46:52,043
BUT WHEN IT COMES DOWN
1709
00:46:52,043 --> 00:46:54,079
TO ACTUALLY DEPRIVING ANYBODY
1710
00:46:54,079 --> 00:46:55,113
OF THESE PROVISIONS,
1711
00:46:55,113 --> 00:46:56,314
IT'S VERY HARD TO GET THEM
1712
00:46:56,314 --> 00:46:57,515
TO DO IT.
1713
00:47:02,420 --> 00:47:04,222
>> REPORT PRELIMINARY FINDINGS.
1714
00:47:04,222 --> 00:47:05,857
>> IN HIS SECOND TERM,
1715
00:47:05,857 --> 00:47:06,858
PRESIDENT BUSH SAID
1716
00:47:06,858 --> 00:47:08,126
THAT ONE OF HIS OBJECTIVES
1717
00:47:08,126 --> 00:47:09,394
WAS TO SIMPLIFY THE TAX CODE
1718
00:47:09,394 --> 00:47:11,262
FOR VERY GOOD REASONS--
1719
00:47:11,262 --> 00:47:13,131
THE BURDEN IS GREAT
1720
00:47:13,131 --> 00:47:14,966
ON THE TAXPAYER.
1721
00:47:14,966 --> 00:47:16,567
>> G.W. Bush: UH, I AM...
1722
00:47:16,567 --> 00:47:18,369
FIRM IN MY DESIRE
1723
00:47:18,369 --> 00:47:19,470
TO GET SOMETHIN' DONE.
1724
00:47:19,470 --> 00:47:21,306
WE'RE GONNA TAKE THEIR WORK,
1725
00:47:21,306 --> 00:47:23,208
AND WE'LL GO TO THE CONGRESS
1726
00:47:23,208 --> 00:47:24,575
AND SAY, "LET'S WORK TOGETHER
1727
00:47:24,575 --> 00:47:26,444
TO ACHIEVE SOMETHING, UH,
1728
00:47:26,444 --> 00:47:27,445
VERY CONSTRUCTIVE
1729
00:47:27,445 --> 00:47:29,247
FOR THE AMERICAN PEOPLE."
1730
00:47:29,247 --> 00:47:30,982
>> UNFORTUNATELY, OTHER
1731
00:47:30,982 --> 00:47:32,317
PRIORITIES TOOK THE PLACE
1732
00:47:32,317 --> 00:47:34,052
OF THAT, AND THE PRESIDENT
1733
00:47:34,052 --> 00:47:35,553
WAS, INSTEAD, YOU KNOW,
1734
00:47:35,553 --> 00:47:37,155
AT THAT POINT, PREOCCUPIED
1735
00:47:37,155 --> 00:47:38,623
WITH THE SOCIAL SECURITY REFORM,
1736
00:47:38,623 --> 00:47:40,025
WHICH DIDN'T-- DIDN'T--
1737
00:47:40,025 --> 00:47:41,092
DIDN'T GO OVER SO WELL.
1738
00:47:41,092 --> 00:47:43,995
>> WELL, THAT'S THE STORY
1739
00:47:43,995 --> 00:47:46,531
ON THAT PARTICULAR PROJECT.
1740
00:47:46,531 --> 00:47:47,565
>> THESE POLITICIANS
1741
00:47:47,565 --> 00:47:49,100
DON'T WILLING GIVE UP POWER.
1742
00:47:49,100 --> 00:47:50,601
THEY'RE NOT GOING TO
1743
00:47:50,601 --> 00:47:52,037
GIVE UP THE POWER THEY HAVE
1744
00:47:52,037 --> 00:47:53,438
UNDER OUR CURRENT TAX CODE.
1745
00:47:53,438 --> 00:47:54,439
>> IF ONLY THERE WERE
1746
00:47:54,439 --> 00:47:55,440
MORE POWER, BETTY!
1747
00:47:55,440 --> 00:47:56,441
>> IS THERE ANY WAY
1748
00:47:56,441 --> 00:47:57,575
TO GENERATE MORE POWER?
1749
00:47:57,575 --> 00:47:59,344
WE'VE GOT TO HAVE MORE!
1750
00:47:59,344 --> 00:48:03,214
>> ( screeching )
1751
00:48:03,214 --> 00:48:04,449
>> POLITICS HAS SCREWED UP
1752
00:48:04,449 --> 00:48:05,583
ALL EFFORTS TO, UH,
1753
00:48:05,583 --> 00:48:06,985
DO TAX SIMPLIFICATION.
1754
00:48:06,985 --> 00:48:08,553
I MEAN, YOU KNOW, I PERSONALLY
1755
00:48:08,553 --> 00:48:10,188
DEFINE POLITICS
1756
00:48:10,188 --> 00:48:11,189
AS A CURIOUS FORM
1757
00:48:11,189 --> 00:48:12,490
OF JUVENILE DELINQUENCY.
1758
00:48:12,490 --> 00:48:15,060
>> ( blows landing )
1759
00:48:15,060 --> 00:48:16,094
>> WELL, WHAT HAPPENS
1760
00:48:16,094 --> 00:48:17,095
WHEN YOU TRY TO PUSH
1761
00:48:17,095 --> 00:48:18,096
A GOOD IDEA THROUGH
1762
00:48:18,096 --> 00:48:19,330
THE LEGISLATIVE PROCESS,
1763
00:48:19,330 --> 00:48:20,999
EVERYBODY-- EVERY POLITICIAN
1764
00:48:20,999 --> 00:48:22,067
SAYS IN SO MANY WORDS,
1765
00:48:22,067 --> 00:48:25,236
"WHAT'S IN IT FOR ME, OR PEOPLE
1766
00:48:25,236 --> 00:48:26,938
THAT ARE SIGNIFICANT TO ME,
1767
00:48:26,938 --> 00:48:29,975
LIKE MY CAMPAIGN CONTRIBUTORS?"
1768
00:48:29,975 --> 00:48:31,342
>> SAY, WHAT THEY TEACHING YOU
1769
00:48:31,342 --> 00:48:32,944
UP AT THAT YANKEE UNIVERSITY,
1770
00:48:32,944 --> 00:48:34,179
BAD MANNERS?
1771
00:48:34,179 --> 00:48:35,580
>> THE SPECIAL INTEREST GROUPS
1772
00:48:35,580 --> 00:48:36,948
AND THE POLITICIANS HAVE
1773
00:48:36,948 --> 00:48:38,149
A VERY COZY RELATIONSHIP
1774
00:48:38,149 --> 00:48:39,384
WHERE THEY GET TO EXCHANGE
1775
00:48:39,384 --> 00:48:40,385
CAMPAIGN CASH
1776
00:48:40,385 --> 00:48:42,687
FOR SPECIAL INTEREST LOOPHOLES,
1777
00:48:42,687 --> 00:48:43,688
AND THAT'S A GAME
1778
00:48:43,688 --> 00:48:45,223
THAT THE AMERICAN PEOPLE LOSE,
1779
00:48:45,223 --> 00:48:46,491
BUT IT'S THE SPECIAL INTEREST
1780
00:48:46,491 --> 00:48:47,592
GROUPS AND THE POLITICIANS
1781
00:48:47,592 --> 00:48:48,593
THAT WIN.
1782
00:48:48,593 --> 00:48:50,195
>> THE RHETORIC IS ALWAYS THERE
1783
00:48:50,195 --> 00:48:51,296
TO HELP THE PEOPLE, AH,
1784
00:48:51,296 --> 00:48:52,297
STICK IT TO ONE GROUP
1785
00:48:52,297 --> 00:48:53,298
VERSUS THE OTHER,
1786
00:48:53,298 --> 00:48:54,299
CLASS WARFARE,
1787
00:48:54,299 --> 00:48:55,300
THAT SORT OF THING--
1788
00:48:55,300 --> 00:48:56,567
THAT'S ALL THEY TALK ABOUT,
1789
00:48:56,567 --> 00:48:57,635
BUT IT'S ALL POLITICS.
1790
00:48:57,635 --> 00:48:59,037
>> DON'T RILE ME, BOY.
1791
00:48:59,037 --> 00:49:00,638
DON'T RILE ME.
1792
00:49:00,638 --> 00:49:02,107
>> WE HAVE 35,000 LOBBYISTS
1793
00:49:02,107 --> 00:49:03,441
IN WASHINGTON WHOSE SOLE JOB
1794
00:49:03,441 --> 00:49:05,110
IS MOSTLY TO GET
1795
00:49:05,110 --> 00:49:07,145
A TAX BREAK FOR THEIR EMPLOYERS.
1796
00:49:07,145 --> 00:49:08,213
>> WHAT PEOPLE WILL DO
1797
00:49:08,213 --> 00:49:09,380
WILL BE TO LOBBY
1798
00:49:09,380 --> 00:49:11,382
FOR VERY, VERY NARROW BENEFITS,
1799
00:49:11,382 --> 00:49:13,384
YOU KNOW, A PARTICULAR EXEMPTION
1800
00:49:13,384 --> 00:49:15,353
FOR A PARTICULAR PRODUCT,
1801
00:49:15,353 --> 00:49:16,587
OR A PARTICULAR EXEMPTION
1802
00:49:16,587 --> 00:49:18,289
FOR SOMETHING THAT IS
1803
00:49:18,289 --> 00:49:19,690
MANUFACTURED IN A CERTAIN WAY,
1804
00:49:19,690 --> 00:49:21,259
OR A PARTICULAR EXEMPTION
1805
00:49:21,259 --> 00:49:22,493
FOR RESEARCH.
1806
00:49:22,493 --> 00:49:23,628
>> A BUSINESS CAN COME IN
1807
00:49:23,628 --> 00:49:24,996
AND MAKE A BIG DONATION
1808
00:49:24,996 --> 00:49:26,164
TO A MEMBER OF CONGRESS,
1809
00:49:26,164 --> 00:49:27,665
AND HE'LL HEAR THEM OUT
1810
00:49:27,665 --> 00:49:29,034
ABOUT PARTICULAR THINGS
1811
00:49:29,034 --> 00:49:30,035
THEY WAY, VERSUS
1812
00:49:30,035 --> 00:49:31,036
SOME OTHER BUSINESS
1813
00:49:31,036 --> 00:49:32,103
OR A LABOR UNION
1814
00:49:32,103 --> 00:49:33,271
OR A NONPROFIT,
1815
00:49:33,271 --> 00:49:35,540
EVEN CHURCH GROUPS AND OTHERS.
1816
00:49:35,540 --> 00:49:37,675
>> YEAH, MAC, FOR FIVE Gs,
1817
00:49:37,675 --> 00:49:39,677
IT'S IN THE BAG.
1818
00:49:39,677 --> 00:49:41,279
>> IF YOU HAVE ENOUGH LOBBYISTS
1819
00:49:41,279 --> 00:49:42,547
IN WASHINGTON SO THAT THERE
1820
00:49:42,547 --> 00:49:43,548
ARE 70 LOBBYISTS
1821
00:49:43,548 --> 00:49:45,116
FOR EVERY MEMBER OF CONGRESS...
1822
00:49:45,116 --> 00:49:46,517
I THINK MOST AMERICAN CITIZENS
1823
00:49:46,517 --> 00:49:47,618
UNDERSTAND AS THEY SIT
1824
00:49:47,618 --> 00:49:49,154
AT THE DINNER TABLE AT NIGHT,
1825
00:49:49,154 --> 00:49:50,455
"MAN, I'M GROSSLY OUTMANNED
1826
00:49:50,455 --> 00:49:51,556
UP THERE."
1827
00:49:51,556 --> 00:49:52,590
>> NOW, I HAD OBSERVED
1828
00:49:52,590 --> 00:49:53,691
THE PROCESS OF MEMBERS
1829
00:49:53,691 --> 00:49:55,360
SEEKING COMMITTEE ASSIGNMENTS
1830
00:49:55,360 --> 00:49:56,361
FOR A LOT OF YEARS,
1831
00:49:56,361 --> 00:49:58,163
AND PARTICIPATED IN THE PROCESS.
1832
00:49:58,163 --> 00:50:00,298
I DON'T RECALL EVER HAVING HAD
1833
00:50:00,298 --> 00:50:01,566
A MEMBER COME TO ME
1834
00:50:01,566 --> 00:50:02,633
AND SAY, "DICK, I WANT TO BE
1835
00:50:02,633 --> 00:50:03,634
ON WAYS AND MEANS
1836
00:50:03,634 --> 00:50:05,170
BECAUSE I'M INTERESTED
1837
00:50:05,170 --> 00:50:06,237
IN THE TAX CODE."
1838
00:50:06,237 --> 00:50:08,406
IT WAS, "I WANNA BE
1839
00:50:08,406 --> 00:50:09,407
ON WAYS AND MEANS
1840
00:50:09,407 --> 00:50:11,109
BECAUSE IT'S AN EXCELLENT
1841
00:50:11,109 --> 00:50:12,177
COMMITTEE FROM WHICH
1842
00:50:12,177 --> 00:50:13,178
TO RAISE THE FUNDS
1843
00:50:13,178 --> 00:50:14,179
FOR MY CAMPAIGN."
1844
00:50:14,179 --> 00:50:16,347
SAME WITH SENATE FINANCE.
1845
00:50:16,347 --> 00:50:18,383
WELL, HOW DO YOU RAISE FUNDS?
1846
00:50:18,383 --> 00:50:21,319
YOU, IN FACT, PEDDLE TAX FAVORS.
1847
00:50:21,319 --> 00:50:24,055
>> ( calling auction )
1848
00:50:24,055 --> 00:50:27,058
>> ( man shouts )
1849
00:50:27,058 --> 00:50:28,326
>> "WE'LL GET THIS CAMPAIGN
1850
00:50:28,326 --> 00:50:29,327
HELP FOR YOU,
1851
00:50:29,327 --> 00:50:30,361
WE'LL DO THAT FOR YOU,
1852
00:50:30,361 --> 00:50:31,429
WE'LL DO THIS FOR YOU.
1853
00:50:31,429 --> 00:50:32,830
YOU'VE GOTTA, UH, YOU'VE GOTTA
1854
00:50:32,830 --> 00:50:33,831
HELP MY CLIENT OUT
1855
00:50:33,831 --> 00:50:35,333
WITH THIS LITTLE TAX PROBLEM
1856
00:50:35,333 --> 00:50:36,334
THEY'RE HAVING."
1857
00:50:36,334 --> 00:50:37,468
WE HAVE TAX EXEMPTIONS
1858
00:50:37,468 --> 00:50:39,204
FOR SPECIFIC MANUFACTURERS
1859
00:50:39,204 --> 00:50:41,072
OF CEILING FANS.
1860
00:50:41,072 --> 00:50:42,073
>> I CAN'T GET IT OUT
1861
00:50:42,073 --> 00:50:43,074
OF MY MIND, JAMES.
1862
00:50:43,074 --> 00:50:44,075
WE'RE CROOKS.
1863
00:50:44,075 --> 00:50:45,476
>> ( chuckles )
1864
00:50:45,476 --> 00:50:46,477
YOU TALK AS IF
1865
00:50:46,477 --> 00:50:48,246
YOU'RE JUST FINDING THAT OUT.
1866
00:50:48,246 --> 00:50:49,514
>> AS LONG AS WE'RE ELECTING
1867
00:50:49,514 --> 00:50:50,748
PEOPLE AND THEY'VE GOT FRIENDS
1868
00:50:50,748 --> 00:50:51,782
WHO HELP THEM GET ELECTED,
1869
00:50:51,782 --> 00:50:52,783
AND THEY'VE GOT FRIENDS
1870
00:50:52,783 --> 00:50:53,851
WHO ARE GIVING THEM MONEY,
1871
00:50:53,851 --> 00:50:54,852
OR GIVING THEM JOBS
1872
00:50:54,852 --> 00:50:56,087
AFTER THEY LEAVE,
1873
00:50:56,087 --> 00:50:57,188
THERE ARE ALWAYS GONNA BE
1874
00:50:57,188 --> 00:50:58,356
REASONS WHY LAWMAKERS WANT
1875
00:50:58,356 --> 00:50:59,490
TO DO FAVORS FOR CERTAIN PEOPLE.
1876
00:50:59,490 --> 00:51:00,691
SOMETIMES THEY'RE GOOD REASONS.
1877
00:51:00,691 --> 00:51:01,692
SOMETIMES THEY WANT
1878
00:51:01,692 --> 00:51:02,693
TO HELP AN INDUSTRY.
1879
00:51:02,693 --> 00:51:04,095
SOMETIMES THEY WANT TO HELP
1880
00:51:04,095 --> 00:51:05,096
A COMPANY THAT'S
1881
00:51:05,096 --> 00:51:06,097
IN THEIR DISTRICT-- I MEAN,
1882
00:51:06,097 --> 00:51:07,098
THESE ARE GOOD REASONS,
1883
00:51:07,098 --> 00:51:08,166
BUT ALL OF THAT LEADS THEM
1884
00:51:08,166 --> 00:51:09,234
TO CLUTTER UP THE TAX CODE.
1885
00:51:09,234 --> 00:51:10,468
>> WE HAVE A BULLETIN
1886
00:51:10,468 --> 00:51:11,469
JUST RECEIVED.
1887
00:51:11,469 --> 00:51:12,503
ACCORDING TO A REPORT
1888
00:51:12,503 --> 00:51:13,504
NOT YET CONFIRMED,
1889
00:51:13,504 --> 00:51:14,572
A BEAST OF SEEMINGLY
1890
00:51:14,572 --> 00:51:15,640
GIGANTIC PROPORTIONS
1891
00:51:15,640 --> 00:51:16,641
HAS BEEN SIGHTED
1892
00:51:16,641 --> 00:51:17,642
LURKING IN THE HILLS
1893
00:51:17,642 --> 00:51:20,111
DUE NORTHEAST OF TOWN.
1894
00:51:20,111 --> 00:51:21,112
>> ( gavel strikes )
1895
00:51:21,112 --> 00:51:22,480
>> WE'LL COME TO ORDER.
1896
00:51:22,480 --> 00:51:25,383
UM, I'M COMMITTED TO, UM,
1897
00:51:25,383 --> 00:51:27,385
DO ALL WE POSSIBLY CAN,
1898
00:51:27,385 --> 00:51:29,387
THIS COMMITTEE, THIS YEAR,
1899
00:51:29,387 --> 00:51:30,521
TO SET THE STAGE
1900
00:51:30,521 --> 00:51:33,491
FOR SIGNIFICANT TAX REFORM.
1901
00:51:33,491 --> 00:51:34,859
MY-- I BELIEVE THAT VIRTUALLY
1902
00:51:34,859 --> 00:51:37,462
NO ONE IN THE CONGRESS
1903
00:51:37,462 --> 00:51:39,264
HAS A SUFFICIENT GRASP
1904
00:51:39,264 --> 00:51:40,431
OF THE CODE.
1905
00:51:40,431 --> 00:51:41,766
>> THERE'S A DOZEN PROPOSALS
1906
00:51:41,766 --> 00:51:43,201
THAT HAVE BEEN INTRODUCED
1907
00:51:43,201 --> 00:51:44,202
INTO CONGRESS--
1908
00:51:44,202 --> 00:51:45,203
I'M NOT GONNA NAME
1909
00:51:45,203 --> 00:51:46,404
THE SPONSORS-- TO REVAMP
1910
00:51:46,404 --> 00:51:47,505
OR REFORM THE TAX CODE,
1911
00:51:47,505 --> 00:51:48,539
INCLUDING PROPOSALS
1912
00:51:48,539 --> 00:51:50,441
FOR A FAIR TAX, FLAT TAX...
1913
00:51:50,441 --> 00:51:51,442
>> THERE SEEMS TO BE
1914
00:51:51,442 --> 00:51:52,543
A CONSENSUS GATHERING
1915
00:51:52,543 --> 00:51:54,212
THAT WE NEED, QUOTE, TAX REFORM.
1916
00:51:54,212 --> 00:51:55,413
THERE IS NOT A CONSENSUS,
1917
00:51:55,413 --> 00:51:57,315
HOWEVER, ABOUT WHAT THAT MEANS.
1918
00:51:57,315 --> 00:51:58,516
>> HOW, AS WE MOVE FORWARD
1919
00:51:58,516 --> 00:52:00,485
WITH, UH, THE DISCUSSION
1920
00:52:00,485 --> 00:52:03,188
ON TAX REFORM, UH,
1921
00:52:03,188 --> 00:52:04,822
SHOULD WE FACTOR IN
1922
00:52:04,822 --> 00:52:06,891
THE, UH, NEED FOR US,
1923
00:52:06,891 --> 00:52:07,892
AS A GOVERNMENT,
1924
00:52:07,892 --> 00:52:11,162
TO BE FISCALLY, UH, RESPONSIBLE?
1925
00:52:11,162 --> 00:52:12,163
>> "HOW DO WE MOVE
1926
00:52:12,163 --> 00:52:13,164
TO ANY OF THESE SYSTEMS
1927
00:52:13,164 --> 00:52:14,165
WHEN MANY OF THEM WOULD DO AWAY
1928
00:52:14,165 --> 00:52:15,300
WITH THE POPULAR EXEMPTIONS
1929
00:52:15,300 --> 00:52:16,301
AND DEDUCTIONS,
1930
00:52:16,301 --> 00:52:17,302
SUCH AS THE DEDUCTIONS
1931
00:52:17,302 --> 00:52:18,569
FOR MORTGAGE INTEREST PAYMENTS?"
1932
00:52:18,569 --> 00:52:20,205
>> JUST, ALL THINGS BEING EQUAL,
1933
00:52:20,205 --> 00:52:21,272
IS THERE A-- TEND TO BE
1934
00:52:21,272 --> 00:52:22,273
A MORE EFFICIENT WAY
1935
00:52:22,273 --> 00:52:24,909
TO RAISE REVENUE...
1936
00:52:24,909 --> 00:52:27,178
UM, COMPARED WITH OTHER WAYS?
1937
00:52:27,178 --> 00:52:28,713
>> AS YOU SAID, MR. CHAIRMAN,
1938
00:52:28,713 --> 00:52:30,581
OUR TAX SYSTEM IS BADLY BROKEN.
1939
00:52:30,581 --> 00:52:32,450
NO ONE QUARRELS WITH THAT.
1940
00:52:32,450 --> 00:52:33,884
YOU MENTION THE TRAIN WRECK
1941
00:52:33,884 --> 00:52:36,187
COMING IN 2010.
1942
00:52:36,187 --> 00:52:37,422
>> I'M SORRY, I'M GONNA HAVE
1943
00:52:37,422 --> 00:52:38,689
TO CLOSE THIS HEARING DOWN.
1944
00:52:38,689 --> 00:52:40,958
WE'RE WAY LATE FOR A VOTE.
1945
00:52:40,958 --> 00:52:43,461
MEETING'S ADJOURNED.
1946
00:53:22,400 --> 00:53:23,534
>> Burman: A LONG-STANDING ISSUE
1947
00:53:23,534 --> 00:53:24,669
IN TAX POLICY IS WHETHER
1948
00:53:24,669 --> 00:53:25,870
YOU SHOULD TAX INCOME--
1949
00:53:25,870 --> 00:53:27,838
HOW MUCH PEOPLE PRODUCE,
1950
00:53:27,838 --> 00:53:28,839
OR CONSUMPTION--
1951
00:53:28,839 --> 00:53:30,741
HOW MUCH THEY SPEND,
1952
00:53:30,741 --> 00:53:32,410
AND THERE'S BEEN A PHILOSOPHICAL
1953
00:53:32,410 --> 00:53:33,444
DEBATE THAT'S GONE BACK
1954
00:53:33,444 --> 00:53:34,445
TO HOBBES AND LOCKE
1955
00:53:34,445 --> 00:53:35,446
AND PHILOSOPHERS
1956
00:53:35,446 --> 00:53:36,514
HUNDREDS OF YEARS AGO.
1957
00:53:36,514 --> 00:53:37,982
>> YES, IT'S AMAZING
1958
00:53:37,982 --> 00:53:39,284
WHEN YOU STOP AND THINK
1959
00:53:39,284 --> 00:53:40,785
ABOUT IT.
1960
00:53:40,785 --> 00:53:42,520
>> AMERICANS HAVE BEEN
1961
00:53:42,520 --> 00:53:43,721
SCHIZOPHRENIC IN THE WAY
1962
00:53:43,721 --> 00:53:45,356
THAT WE GO ABOUT TAXES.
1963
00:53:45,356 --> 00:53:46,691
AT SOME TIMES, WE WANTED
1964
00:53:46,691 --> 00:53:48,259
TO JUST TAX THE CONSUMPTION--
1965
00:53:48,259 --> 00:53:49,527
THAT IS, THE SALE OF THINGS--
1966
00:53:49,527 --> 00:53:50,661
AND OTHER TIMES, WE WANT
1967
00:53:50,661 --> 00:53:52,263
TO TAX JUST INCOME.
1968
00:53:52,263 --> 00:53:53,398
AT OTHER TIMES, WE WANT
1969
00:53:53,398 --> 00:53:54,399
TO TAX SAVINGS,
1970
00:53:54,399 --> 00:53:55,733
OR THE RETURN TO INVESTMENT
1971
00:53:55,733 --> 00:53:56,834
THROUGH CAPITAL GAINS
1972
00:53:56,834 --> 00:53:57,835
AND DIVIDENDS,
1973
00:53:57,835 --> 00:53:59,370
AND WHAT IT'S COME DOWN TO NOW
1974
00:53:59,370 --> 00:54:00,538
IS THAT WE JUST BASICALLY
1975
00:54:00,538 --> 00:54:01,639
TAX EVERYTHING.
1976
00:54:01,639 --> 00:54:02,507
>> Shaviro: EVER SINCE
1977
00:54:02,507 --> 00:54:03,508
THERE'S BEEN A TAX, THE PHRASE
1978
00:54:03,508 --> 00:54:04,509
"TAX REFORM" HAS BEEN
1979
00:54:04,509 --> 00:54:05,510
VERY POPULAR.
1980
00:54:05,510 --> 00:54:06,677
HOW CAN YOU BE AGAINST IT?
1981
00:54:06,677 --> 00:54:07,812
TO AN EXTENT, EVERYONE
1982
00:54:07,812 --> 00:54:08,913
WILL DEFINE TAX REFORM
1983
00:54:08,913 --> 00:54:10,047
AS "WHAT I WANT,
1984
00:54:10,047 --> 00:54:11,549
THAT'S TAX REFORM."
1985
00:54:11,549 --> 00:54:12,550
>> NOW, NONE OF LIKE
1986
00:54:12,550 --> 00:54:13,818
CRYSTAL-GAZING, SO LET'S
1987
00:54:13,818 --> 00:54:14,819
TAKE A LOOK AT WHAT IS
1988
00:54:14,819 --> 00:54:16,654
ACTUALLY HAPPENING NOW.
1989
00:54:16,654 --> 00:54:18,022
>> WE DO HAVE A TAX SYSTEM TODAY
1990
00:54:18,022 --> 00:54:19,023
WHICH IS A HYBRID.
1991
00:54:19,023 --> 00:54:20,358
WE CALL IT AN INCOME TAX,
1992
00:54:20,358 --> 00:54:21,559
AND THAT'S KIND OF FUNNY,
1993
00:54:21,559 --> 00:54:22,560
BECAUSE IT'S NOT.
1994
00:54:22,560 --> 00:54:23,994
IT'S ABOUT ONE THIRD INCOME TAX,
1995
00:54:23,994 --> 00:54:25,463
ONE THIRD CONSUMPTION TAX,
1996
00:54:25,463 --> 00:54:26,564
ONE THIRD NEITHER.
1997
00:54:26,564 --> 00:54:27,932
>> Burman: CONSUMPTION, SPENDING
1998
00:54:27,932 --> 00:54:29,334
IS BASICALLY JUST THE DIFFERENCE
1999
00:54:29,334 --> 00:54:30,601
BETWEEN THE AMOUNT YOU EARN
2000
00:54:30,601 --> 00:54:31,702
AND THE AMOUNT YOU SAVE
2001
00:54:31,702 --> 00:54:33,304
AND THE AMOUNT YOU PAY IN TAXES,
2002
00:54:33,304 --> 00:54:34,639
BUT UNDER OUR CURRENT INCOME TAX
2003
00:54:34,639 --> 00:54:35,706
THERE ARE A LOT OF WAYS
2004
00:54:35,706 --> 00:54:36,941
IN WHICH YOU CAN BASICALLY
2005
00:54:36,941 --> 00:54:38,443
GET A DEDUCTION FOR SAVINGS,
2006
00:54:38,443 --> 00:54:39,744
SO IT'S MOVING IN THE DIRECTION
2007
00:54:39,744 --> 00:54:40,778
OF A CONSUMPTION TAX.
2008
00:54:40,778 --> 00:54:41,779
SO, IF YOU PUT MONEY
2009
00:54:41,779 --> 00:54:42,913
INTO YOUR HOUSE, YOU GET
2010
00:54:42,913 --> 00:54:44,615
TO DEDUCT THE MORTGAGE INTEREST.
2011
00:54:44,615 --> 00:54:45,850
IF YOU PUT MONEY INTO AN IRA
2012
00:54:45,850 --> 00:54:47,952
OR INTO A 401(k),
2013
00:54:47,952 --> 00:54:49,520
OR YOUR EMPLOYER PUTS MONEY
2014
00:54:49,520 --> 00:54:50,521
INTO A PENSION,
2015
00:54:50,521 --> 00:54:51,522
THAT'S NOT INCLUDED
2016
00:54:51,522 --> 00:54:52,523
IN YOUR INCOME.
2017
00:54:52,523 --> 00:54:53,924
SO, AGAIN, THAT'S THE SAME KIND
2018
00:54:53,924 --> 00:54:55,360
OF TAX TREATMENT AS YOU GET
2019
00:54:55,360 --> 00:54:56,494
UNDER A CONSUMPTION TAX.
2020
00:54:58,763 --> 00:55:01,499
>> YOU MUST UNDERSTAND.
2021
00:55:05,703 --> 00:55:08,038
>> EVERY ECONOMIST WILL TELL YOU
2022
00:55:08,038 --> 00:55:09,607
THAT MANY WILL FAVOR
2023
00:55:09,607 --> 00:55:10,608
A CONSUMPTION TAX.
2024
00:55:10,608 --> 00:55:12,343
BUT IF YOU HAVE AN INCOME TAX
2025
00:55:12,343 --> 00:55:13,944
WHICH DOESN'T TRY TO DO
2026
00:55:13,944 --> 00:55:15,813
ALL OF THE MANIPULATING
2027
00:55:15,813 --> 00:55:17,848
OF THE WAY IN WHICH WE BEHAVE,
2028
00:55:17,848 --> 00:55:18,849
STAYS OUT OF IT,
2029
00:55:18,849 --> 00:55:20,485
AND IT LETS THE MARKETS,
2030
00:55:20,485 --> 00:55:22,353
YOU KNOW, PRETTY MUCH CONTROL
2031
00:55:22,353 --> 00:55:23,654
THOSE THINGS, THAT WE'D HAVE
2032
00:55:23,654 --> 00:55:24,655
A STRONGER ECONOMY.
2033
00:55:24,655 --> 00:55:25,856
THAT MEANS HIGHER WAGES,
2034
00:55:25,856 --> 00:55:27,958
MORE SAVINGS, MORE INVESTMENT,
2035
00:55:27,958 --> 00:55:29,960
STRONGER COMPANIES, MORE--
2036
00:55:29,960 --> 00:55:31,095
MORE COMPANIES THAT CAN
2037
00:55:31,095 --> 00:55:32,563
COMPETE INTERNATIONALLY.
2038
00:55:32,563 --> 00:55:34,098
THAT'S A HUGE ADVANTAGE.
2039
00:55:34,098 --> 00:55:36,000
>> EVERYONE IN THE POLICY WORLD
2040
00:55:36,000 --> 00:55:37,468
WOULD PREFER A BROAD-BASED,
2041
00:55:37,468 --> 00:55:38,469
LOW-RATE INCOME TAX
2042
00:55:38,469 --> 00:55:40,037
TO ONE LIKE WHAT WE HAVE NOW,
2043
00:55:40,037 --> 00:55:41,872
BUT NONETHELESS, TAX REFORM
2044
00:55:41,872 --> 00:55:43,107
HAS KIND OF BEEN CONVERTED
2045
00:55:43,107 --> 00:55:44,809
INTO... IT'S NOW PREDOMINATELY
2046
00:55:44,809 --> 00:55:45,810
IDENTIFIED WITH
2047
00:55:45,810 --> 00:55:47,512
HAVING A CONSUMPTION TAX.
2048
00:55:47,512 --> 00:55:48,779
>> NOW, THERE ARE MANY WAYS
2049
00:55:48,779 --> 00:55:49,947
YOU CAN GO ABOUT CREATING
2050
00:55:49,947 --> 00:55:51,482
A CONSUMPTION-BASED TAX.
2051
00:55:51,482 --> 00:55:52,483
>> ONE EXAMPLE OF
2052
00:55:52,483 --> 00:55:53,718
A CONSUMPTION-BASED TAX
2053
00:55:53,718 --> 00:55:55,119
IS TO HAVE A NATIONAL SALES TAX,
2054
00:55:55,119 --> 00:55:57,555
BUT A FLAT TAX,
2055
00:55:57,555 --> 00:55:59,424
AT LEAST PROPERLY DEFINED,
2056
00:55:59,424 --> 00:56:01,792
IS ALSO A CONSUMPTION-BASED TAX.
2057
00:56:01,792 --> 00:56:02,793
>> THERE'S MORE TO IT
2058
00:56:02,793 --> 00:56:03,794
THAN THAT, JOE.
2059
00:56:03,794 --> 00:56:05,530
THERE'S SOMETHING BEHIND THIS,
2060
00:56:05,530 --> 00:56:07,732
SOMETHING WE DON'T UNDERSTAND.
2061
00:56:07,732 --> 00:56:08,999
>> CERTAIN TYPES OF INCOME,
2062
00:56:08,999 --> 00:56:10,601
CAPITAL INCOME IN PARTICULAR,
2063
00:56:10,601 --> 00:56:11,736
DON'T GET TAXED
2064
00:56:11,736 --> 00:56:13,604
UNDER A CONSUMPTION TAX,
2065
00:56:13,604 --> 00:56:14,805
AND THAT WILL LEAVE
2066
00:56:14,805 --> 00:56:15,806
CERTAIN PEOPLE
2067
00:56:15,806 --> 00:56:17,074
WITH MUCH LOWER TAX BILLS.
2068
00:56:17,074 --> 00:56:19,677
MUCH, MUCH LOWER TAX BILLS.
2069
00:56:19,677 --> 00:56:21,479
RICH PEOPLE WILL PAY
2070
00:56:21,479 --> 00:56:23,147
CONSIDERABLY LESS,
2071
00:56:23,147 --> 00:56:24,682
UNLESS THE SYSTEM
2072
00:56:24,682 --> 00:56:26,551
IS DESIGNED CAREFULLY.
2073
00:56:26,551 --> 00:56:29,420
>> HA! WHAT AN IMAGINATION.
2074
00:56:29,420 --> 00:56:30,688
>> RIGHT. THAT'S JUST WHAT
2075
00:56:30,688 --> 00:56:32,122
IT TAKES MOST OF ALL,
2076
00:56:32,122 --> 00:56:34,024
CREATIVE IMAGINATION.
2077
00:56:34,024 --> 00:56:35,460
>> THE ADVANTAGE OF TAXING
2078
00:56:35,460 --> 00:56:36,794
SPENDING RATHER THAN INCOME
2079
00:56:36,794 --> 00:56:38,563
IS THAT IT'S THOUGHT
2080
00:56:38,563 --> 00:56:39,597
TO BE MORE EFFICIENT.
2081
00:56:39,597 --> 00:56:40,831
IT ENCOURAGES YOU TO SAVE.
2082
00:56:40,831 --> 00:56:41,966
THE CURRENT TAX SYSTEM
2083
00:56:41,966 --> 00:56:43,968
BASICALLY DISCOURAGES SAVING,
2084
00:56:43,968 --> 00:56:45,636
AND THERE'S NOT ANY PARTICULAR
2085
00:56:45,636 --> 00:56:46,837
REASON WE WANT PEOPLE TO SAVE
2086
00:56:46,837 --> 00:56:48,205
LESS THAN THEY WOULD OTHERWISE.
2087
00:56:48,205 --> 00:56:49,206
AND IF YOU LOOK AT
2088
00:56:49,206 --> 00:56:50,908
THE HORRIBLY ANEMIC SAVINGS RATE
2089
00:56:50,908 --> 00:56:51,976
IN THE UNITED STATES,
2090
00:56:51,976 --> 00:56:53,444
IT CERTAINLY WOULD BE
2091
00:56:53,444 --> 00:56:54,845
A GOOD IDEA TO RAISE IT.
2092
00:56:54,845 --> 00:56:56,881
RIGHT NOW, IT'S AROUND ZERO.
2093
00:56:56,881 --> 00:56:58,816
>> WHEN WE RETURN
2094
00:56:58,816 --> 00:57:00,451
POWER TO THE PEOPLE,
2095
00:57:00,451 --> 00:57:01,986
OPPORTUNITY TO THE AMERICAN
2096
00:57:01,986 --> 00:57:03,153
PEOPLE, RESPONSIBILITY
2097
00:57:03,153 --> 00:57:04,489
TO THE AMERICAN PEOPLE,
2098
00:57:04,489 --> 00:57:05,890
THIS NATION IS GONNA MOVE AHEAD
2099
00:57:05,890 --> 00:57:07,057
IN A WAY THAT'LL ASTOUND
2100
00:57:07,057 --> 00:57:08,759
OURSELVES AND THE WORLD.
2101
00:57:08,759 --> 00:57:11,562
REST UP, BECAUSE, MY FRIENDS,
2102
00:57:11,562 --> 00:57:13,664
OUR JOURNEY HAS JUST BEGUN.
2103
00:57:13,664 --> 00:57:15,099
SO, I RAN FOR PRESIDENT
2104
00:57:15,099 --> 00:57:17,034
IN BOTH 1996 AND 2000
2105
00:57:17,034 --> 00:57:18,969
ON THE FLAT TAX.
2106
00:57:18,969 --> 00:57:20,204
FORTUNATELY, THE MESSAGE
2107
00:57:20,204 --> 00:57:21,739
DID BETTER THAN THE MESSENGER.
2108
00:57:21,739 --> 00:57:22,740
UNDER THE PROPOSAL
2109
00:57:22,740 --> 00:57:23,874
THAT I HAD, FOR EXAMPLE,
2110
00:57:23,874 --> 00:57:25,142
YOU'D HAVE A SINGLE RATE,
2111
00:57:25,142 --> 00:57:27,011
17%, THAT WOULD APPLY
2112
00:57:27,011 --> 00:57:28,913
AFTER GENEROUS EXEMPTIONS
2113
00:57:28,913 --> 00:57:30,748
FOR ADULTS AND FOR CHILDREN,
2114
00:57:30,748 --> 00:57:31,749
AND THERE'D BE NO TAX
2115
00:57:31,749 --> 00:57:32,750
ON YOUR SAVINGS.
2116
00:57:32,750 --> 00:57:34,151
EVERYTHING WOULD BE TAX-FREE
2117
00:57:34,151 --> 00:57:35,653
ON YOUR SAVINGS, AND THERE'D
2118
00:57:35,653 --> 00:57:36,654
BE NO DEATH TAX.
2119
00:57:36,654 --> 00:57:38,222
I THINK YOU SHOULD BE ALLOWED
2120
00:57:38,222 --> 00:57:39,223
TO LEAVE THE WORLD
2121
00:57:39,223 --> 00:57:40,625
UNMOLESTED BY THE IRS.
2122
00:57:40,625 --> 00:57:41,626
YOU PAID ENOUGH
2123
00:57:41,626 --> 00:57:42,760
DURING YOUR LIFETIME,
2124
00:57:42,760 --> 00:57:44,061
OR AS OUR FOUNDERS WOULD SAY,
2125
00:57:44,061 --> 00:57:45,062
"NO TAXATION
2126
00:57:45,062 --> 00:57:46,597
WITHOUT RESPIRATION."
2127
00:57:46,597 --> 00:57:47,732
>> YOU EARN YOUR INCOME,
2128
00:57:47,732 --> 00:57:49,500
YOU REPORT YOUR INCOME,
2129
00:57:49,500 --> 00:57:50,501
YOU DEDUCT
2130
00:57:50,501 --> 00:57:51,602
YOUR FAMILY ALLOWANCE,
2131
00:57:51,602 --> 00:57:52,603
YOU APPLY THE RATE,
2132
00:57:52,603 --> 00:57:53,604
AND YOU'RE DONE.
2133
00:57:53,604 --> 00:57:54,839
>> THE PERKS OF THE FLAT TAX
2134
00:57:54,839 --> 00:57:56,774
IS IT UNLEASHES PEOPLE'S MINDS,
2135
00:57:56,774 --> 00:57:58,643
THINKING, CREATIVITY,
2136
00:57:58,643 --> 00:58:01,145
ONTO PRODUCTIVE PURSUITS.
2137
00:58:01,145 --> 00:58:02,647
INSTEAD OF SPENDING
2138
00:58:02,647 --> 00:58:04,048
SIX BILLION HOURS, YOU COULD--
2139
00:58:04,048 --> 00:58:05,683
A YEAR WITH FILLING OUT FORMS,
2140
00:58:05,683 --> 00:58:06,884
YOU COULD WASTE THE TIME.
2141
00:58:06,884 --> 00:58:08,252
THAT WOULD BE MORE PRODUCTIVE
2142
00:58:08,252 --> 00:58:09,286
THAN, YOU KNOW, LET
2143
00:58:09,286 --> 00:58:11,188
THE BRAIN REGENERATE.
2144
00:58:11,188 --> 00:58:12,222
>> IT JUST DOESN'T TAKE
2145
00:58:12,222 --> 00:58:13,223
MUCH TIME TO EXPLAIN
2146
00:58:13,223 --> 00:58:14,224
THE FLAT TAX.
2147
00:58:14,224 --> 00:58:15,225
IT'S JUST THERE.
2148
00:58:15,225 --> 00:58:16,226
THAT'S IT, MAN.
2149
00:58:16,226 --> 00:58:17,227
THAT'S ABOUT IT.
2150
00:58:17,227 --> 00:58:18,663
ANYBODY CAN DO IT.
2151
00:58:19,930 --> 00:58:21,532
>> ( cheering )
2152
00:58:21,532 --> 00:58:23,634
>> AND I ENDORSE THE FAIR TAX,
2153
00:58:23,634 --> 00:58:25,202
BECAUSE IT'S THE BEST HOPE WE
2154
00:58:25,202 --> 00:58:27,672
HAVE OF FINALLY CHANGING
2155
00:58:27,672 --> 00:58:29,640
THE TAX SYSTEM IN THIS COUNTRY.
2156
00:58:29,640 --> 00:58:30,741
>> Boortz: THERE WAS THIS GROUP
2157
00:58:30,741 --> 00:58:31,742
OF BUSINESSMEN
2158
00:58:31,742 --> 00:58:33,010
IN HOUSTON, TEXAS.
2159
00:58:33,010 --> 00:58:34,078
THEY JUST HAD THIS LITTLE--
2160
00:58:34,078 --> 00:58:35,212
CALL IT A GAME, IF YOU WANT,
2161
00:58:35,212 --> 00:58:36,947
I DON'T KNOW, BUT THEY WOULD
2162
00:58:36,947 --> 00:58:38,849
TACKLE PROBLEMS.
2163
00:58:38,849 --> 00:58:40,250
>> TWO OTHER FELLOWS AND MYSELF
2164
00:58:40,250 --> 00:58:41,251
WERE HAVING LUNCH,
2165
00:58:41,251 --> 00:58:43,253
AND IN OUR USUAL WAY,
2166
00:58:43,253 --> 00:58:45,089
WE WERE COMPLAINING
2167
00:58:45,089 --> 00:58:46,891
ABOUT THE STATE OF AFFAIRS
2168
00:58:46,891 --> 00:58:48,225
IN THE COUNTRY.
2169
00:58:48,225 --> 00:58:49,560
>> AND THEY SAID, OKAY,
2170
00:58:49,560 --> 00:58:50,995
WE'RE GOING TO NOW HIRE
2171
00:58:50,995 --> 00:58:53,163
COMPLETELY IMPARTIAL EXPERTS,
2172
00:58:53,163 --> 00:58:54,298
AND WE'RE GONNA ASK THEM
2173
00:58:54,298 --> 00:58:55,600
TO COME UP WITH A NEW WAY
2174
00:58:55,600 --> 00:58:56,701
OF COLLECTING REVENUE
2175
00:58:56,701 --> 00:58:58,235
FOR THE FEDERAL GOVERNMENT.
2176
00:58:58,235 --> 00:58:59,837
>> WE ENDED UP TAKING TWO YEARS
2177
00:58:59,837 --> 00:59:02,139
AND $23 MILLION, UH,
2178
00:59:02,139 --> 00:59:04,575
TO COMPLETE THIS STUDY,
2179
00:59:04,575 --> 00:59:06,243
OUT OF WHICH CAME
2180
00:59:06,243 --> 00:59:07,945
THE FAIR TAX.
2181
00:59:07,945 --> 00:59:09,079
>> WE STOP TAXING INCOME,
2182
00:59:09,079 --> 00:59:11,281
AND START TAXING CONSUMPTION.
2183
00:59:11,281 --> 00:59:12,282
>> Boortz: YOU GET RID OF ALL
2184
00:59:12,282 --> 00:59:13,818
CORPORATE INCOME TAX. GONE.
2185
00:59:13,818 --> 00:59:15,052
NO PERSONAL INCOME TAXES.
2186
00:59:15,052 --> 00:59:16,053
IT'S GONE.
2187
00:59:16,053 --> 00:59:17,121
PAYROLL TAXES. GONE.
2188
00:59:17,121 --> 00:59:19,724
ESTATE TAX, DEATH TAX. GONE.
2189
00:59:19,724 --> 00:59:22,326
CAPITAL GAINS TAXES. GONE.
2190
00:59:22,326 --> 00:59:24,328
AND ALL OF THIS IS REPLACED
2191
00:59:24,328 --> 00:59:28,132
BY ONE EMBEDDED FEDERAL
2192
00:59:28,132 --> 00:59:30,601
RETAIL SALES TAX.
2193
00:59:30,601 --> 00:59:31,936
>> WHEN YOU BUY SOMETHING NEW
2194
00:59:31,936 --> 00:59:32,937
AT THE RETAIL LEVEL,
2195
00:59:32,937 --> 00:59:34,071
YOU PAY THE TAX. YOU KNOW
2196
00:59:34,071 --> 00:59:35,339
EXACTLY WHAT YOU'RE PAYING.
2197
00:59:35,339 --> 00:59:37,942
>> IF YOU BUY USED GOODS
2198
00:59:37,942 --> 00:59:39,977
AND SERVICES-- A USED HOUSE
2199
00:59:39,977 --> 00:59:41,278
OR A USED CAR--
2200
00:59:41,278 --> 00:59:43,814
YOU PAY NO SALES TAX.
2201
00:59:43,814 --> 00:59:45,850
>> EVERY HOUSEHOLD WILL GET
2202
00:59:45,850 --> 00:59:46,851
A CASH DISTRIBUTION
2203
00:59:46,851 --> 00:59:48,753
AT THE BEGINNING OF EVERY MONTH
2204
00:59:48,753 --> 00:59:50,888
THAT WILL TOTALLY UNTAX THEM
2205
00:59:50,888 --> 00:59:52,957
UP TO POVERTY-LEVEL SPENDING.
2206
00:59:52,957 --> 00:59:54,759
>> IT ESSENTIALLY UNTAXES
2207
00:59:54,759 --> 00:59:56,894
EVERY POOR AND ELDERLY PERSON
2208
00:59:56,894 --> 00:59:59,063
FROM THEIR BASIC NECESSITIES
2209
00:59:59,063 --> 01:00:01,098
SUCH AS FOOD AND MEDICINE
2210
01:00:01,098 --> 01:00:02,667
AND BASIC UTILITIES.
2211
01:00:02,667 --> 01:00:03,901
>> AND I KNOW-- I KNOW TAXES
2212
01:00:03,901 --> 01:00:05,335
ARE BORING, BUT WHAT'S BORING
2213
01:00:05,335 --> 01:00:06,336
ABOUT GETTING 100%
2214
01:00:06,336 --> 01:00:07,337
OF YOUR PAYCHECK?
2215
01:00:07,337 --> 01:00:10,107
WHAT'S BORING ABOUT NOT HAVING
2216
01:00:10,107 --> 01:00:11,108
TO KEEP TAX RECORDS?
2217
01:00:11,108 --> 01:00:12,710
WHAT'S BORING ABOUT NOT HAVING
2218
01:00:12,710 --> 01:00:13,711
TO KEEP RECEIPTS?
2219
01:00:13,711 --> 01:00:15,045
WHAT'S BORING ABOUT NOT EVER
2220
01:00:15,045 --> 01:00:17,181
WORRYING ABOUT AN IRS AUDIT?
2221
01:00:17,181 --> 01:00:18,683
THOSE THINGS AREN'T BORING.
2222
01:00:18,683 --> 01:00:19,884
THEY'RE NOT-- THAT CAN BE
2223
01:00:19,884 --> 01:00:21,652
THE REALITY, IF PEOPLE
2224
01:00:21,652 --> 01:00:22,653
GET ON THE BANDWAGON
2225
01:00:22,653 --> 01:00:24,054
WITH THE FAIR TAX.
2226
01:00:24,054 --> 01:00:26,724
>> NOW, IN THE POLITICAL WORLD,
2227
01:00:26,724 --> 01:00:27,825
THE CONSUMPTION TAX IS
2228
01:00:27,825 --> 01:00:29,293
BASICALLY A CONSERVATIVE MOVE.
2229
01:00:29,293 --> 01:00:30,294
IT'S BASICALLY A WAY
2230
01:00:30,294 --> 01:00:31,428
OF SAYING WE'RE GONNA TAX
2231
01:00:31,428 --> 01:00:32,429
RICH PEOPLE LESS.
2232
01:00:32,429 --> 01:00:33,831
THEY SAVE MORE THAN POOR PEOPLE,
2233
01:00:33,831 --> 01:00:34,832
SO THEY HAVE MORE OF
2234
01:00:34,832 --> 01:00:35,866
THEIR INCOME COMES FROM SAVING.
2235
01:00:35,866 --> 01:00:36,867
WE'RE GONNA MAKE IT
2236
01:00:36,867 --> 01:00:37,868
LESS PROGRESSIVE
2237
01:00:37,868 --> 01:00:39,036
BY NOT TAXING THEM AS MUCH.
2238
01:00:39,036 --> 01:00:40,037
IN THE ACADEMIC WORLD,
2239
01:00:40,037 --> 01:00:41,038
IT'S VERY DIFFERENT.
2240
01:00:41,038 --> 01:00:42,039
YOU HAVE PEOPLE WHO ARE
2241
01:00:42,039 --> 01:00:43,440
LIBERAL DEMOCRATS WHO FAVOR IT
2242
01:00:43,440 --> 01:00:45,142
AS MUCH AS CONSERVATIVE
2243
01:00:45,142 --> 01:00:46,744
REPUBLICANS, AND THE ARGUMENT
2244
01:00:46,744 --> 01:00:47,745
IS FOR A PROGRESSIVE
2245
01:00:47,745 --> 01:00:49,013
CONSUMPTION TAX OF ONE KIND
2246
01:00:49,013 --> 01:00:50,014
OR ANOTHER, IT WOULD
2247
01:00:50,014 --> 01:00:51,348
APPROXIMATELY AS PROGRESSIVE
2248
01:00:51,348 --> 01:00:52,750
AS THE SYSTEM WE HAVE NOW.
2249
01:00:52,750 --> 01:00:54,251
>> REGARDING A VALUE-ADDED TAX,
2250
01:00:54,251 --> 01:00:55,786
IN EFFECT, A VALUE-ADDED TAX
2251
01:00:55,786 --> 01:00:56,921
IS JUST A DIFFERENT FORM
2252
01:00:56,921 --> 01:00:58,022
OF NATIONAL SALES TAX.
2253
01:00:58,022 --> 01:00:59,023
IT'S WHAT THEY CALL
2254
01:00:59,023 --> 01:01:00,691
A NATIONAL SALES TAX IN EUROPE,
2255
01:01:00,691 --> 01:01:02,126
AND THE REASON THAT THE EUROPEAN
2256
01:01:02,126 --> 01:01:03,193
COUNTRIES HAVE PUT IN
2257
01:01:03,193 --> 01:01:04,194
A VALUE-ADDED TAX
2258
01:01:04,194 --> 01:01:06,330
INSTEAD OF A NATIONAL SALES TAX
2259
01:01:06,330 --> 01:01:07,932
IS BECAUSE THE VALUE-ADDED TAX,
2260
01:01:07,932 --> 01:01:08,933
IN SOME SENSE,
2261
01:01:08,933 --> 01:01:10,234
IS SELF-ENFORCING.
2262
01:01:10,234 --> 01:01:11,769
>> ONE QUESTION IS WHY DOES--
2263
01:01:11,769 --> 01:01:13,003
WHY DO EUROPEAN COUNTRIES
2264
01:01:13,003 --> 01:01:14,004
RELY SO HEAVILY
2265
01:01:14,004 --> 01:01:15,105
ON VALUE-ADDED TAXES?
2266
01:01:15,105 --> 01:01:16,106
THEY RELY MUCH MORE
2267
01:01:16,106 --> 01:01:17,174
ON CONSUMPTION TAXES
2268
01:01:17,174 --> 01:01:18,776
THAN WE DO IN THE UNITED STATES,
2269
01:01:18,776 --> 01:01:20,477
AND THE REASON IS, I THINK,
2270
01:01:20,477 --> 01:01:21,846
THAT THEY DON'T RELY
2271
01:01:21,846 --> 01:01:23,047
ON THE WHOLE TAX SYSTEM--
2272
01:01:23,047 --> 01:01:24,048
THEY DON'T RELY
2273
01:01:24,048 --> 01:01:25,049
ON THE TAX SYSTEM
2274
01:01:25,049 --> 01:01:26,150
AS THEIR PRIMARY MEANS
2275
01:01:26,150 --> 01:01:28,853
OF PROVIDING PROGRESSIVITY.
2276
01:01:28,853 --> 01:01:29,720
>> I THINK IN
2277
01:01:29,720 --> 01:01:30,788
THE ADVANCED COUNTRIES,
2278
01:01:30,788 --> 01:01:31,989
THE DEVELOPED COUNTRIES
2279
01:01:31,989 --> 01:01:33,858
OF THE WORLD, THERE IS
2280
01:01:33,858 --> 01:01:35,359
MUCH MORE EMPHASIS
2281
01:01:35,359 --> 01:01:36,393
ON THE ROLE OF THE--
2282
01:01:36,393 --> 01:01:39,096
OF THE NATIONAL GOVERNMENT.
2283
01:01:39,096 --> 01:01:40,097
>> THEY FINANCE A LOT
2284
01:01:40,097 --> 01:01:41,331
OF THEIR HIGHER EDUCATION
2285
01:01:41,331 --> 01:01:42,733
THROUGH THE GOVERNMENT.
2286
01:01:42,733 --> 01:01:44,234
THEY HAVE UNIVERSAL HEALTH
2287
01:01:44,234 --> 01:01:45,803
INSURANCE THAT THEY FINANCE,
2288
01:01:45,803 --> 01:01:47,004
AND SO, UH, YOU CAN'T JUST
2289
01:01:47,004 --> 01:01:48,005
LOOK AT THE TAX.
2290
01:01:48,005 --> 01:01:49,139
YOU ALSO HAVE TO LOOK
2291
01:01:49,139 --> 01:01:51,175
AT WHAT THE TAX PAYS FOR.
2292
01:01:51,175 --> 01:01:52,777
>> THOSE COUNTRIES TEND TO HAVE
2293
01:01:52,777 --> 01:01:54,478
MUCH HIGHER TAXES THAN WE DO.
2294
01:01:54,478 --> 01:01:55,479
SO, THEY COMBINED
2295
01:01:55,479 --> 01:01:56,480
THE INCOME TAX
2296
01:01:56,480 --> 01:01:57,848
WITH A CONSUMPTION TAX.
2297
01:01:57,848 --> 01:02:00,350
AND YOU SEE IN FRANCE AND ITALY
2298
01:02:00,350 --> 01:02:01,786
AND SWEDEN AND NORWAY
2299
01:02:01,786 --> 01:02:02,787
AND DENMARK AND ALL
2300
01:02:02,787 --> 01:02:03,788
OF THOSE COUNTRIES
2301
01:02:03,788 --> 01:02:05,289
MUCH HIGHER LEVELS OF TAX--
2302
01:02:05,289 --> 01:02:07,191
IN FACT, OUR CURRENT TOTAL
2303
01:02:07,191 --> 01:02:08,993
FEDERAL TAX BURDEN
2304
01:02:08,993 --> 01:02:10,460
IS AMONG THE LOWEST
2305
01:02:10,460 --> 01:02:11,929
OF ALL DEVELOPED COUNTRIES
2306
01:02:11,929 --> 01:02:12,930
IN THE WORLD, AND YET
2307
01:02:12,930 --> 01:02:14,198
WE FEEL WE'RE OVERTAXED.
2308
01:02:14,198 --> 01:02:15,766
WELL, MAYBE WE FEEL OVERTAXED
2309
01:02:15,766 --> 01:02:16,767
'CAUSE WE DON'T LIKE
2310
01:02:16,767 --> 01:02:18,102
THE SERVICES, BUT RELATIVE
2311
01:02:18,102 --> 01:02:20,437
TO OUR INCOME, WE'RE VERY LOW.
2312
01:02:20,437 --> 01:02:23,173
SO, IN EUROPE, HIGHER--
2313
01:02:23,173 --> 01:02:24,875
MUCH HIGHER TAXES
2314
01:02:24,875 --> 01:02:26,977
AND HIGHER SOCIAL SERVICES.
2315
01:02:26,977 --> 01:02:29,146
SO, THAT'S THE TRADEOFF.
2316
01:02:29,146 --> 01:02:30,781
UM, ARE WE WILLING
2317
01:02:30,781 --> 01:02:33,017
TO EXPERIENCE THAT?
2318
01:02:33,017 --> 01:02:36,286
>> YOU KNOW, I NEVER REALIZED
2319
01:02:36,286 --> 01:02:37,922
JUST HOW MUCH
2320
01:02:37,922 --> 01:02:39,556
THESE THINGS MEANT...
2321
01:02:39,556 --> 01:02:41,325
UNTIL NOW.
2322
01:02:52,937 --> 01:02:54,071
>> Fox: ONE OF THE THINGS
2323
01:02:54,071 --> 01:02:55,272
THAT YOU REALLY KNOW IN--
2324
01:02:55,272 --> 01:02:57,007
WHEN IT COMES TO TAXATION,
2325
01:02:57,007 --> 01:02:59,209
IS THAT NO MATTER HOW BAD
2326
01:02:59,209 --> 01:03:00,510
THE SYSTEM MIGHT BE,
2327
01:03:00,510 --> 01:03:02,412
AND I THINK IT'S REALLY, UH,
2328
01:03:02,412 --> 01:03:05,049
INDEFENSIBLE, IT'S THE SYSTEM
2329
01:03:05,049 --> 01:03:06,416
THAT IN SOME WAY PEOPLE KNOW.
2330
01:03:06,416 --> 01:03:07,818
THEY DON'T REALLY KNOW IT,
2331
01:03:07,818 --> 01:03:08,819
BUT THEY-- IT'S WHAT
2332
01:03:08,819 --> 01:03:09,920
THEY'RE FAMILIAR WITH.
2333
01:03:09,920 --> 01:03:11,088
AND SO EVEN THOUGH THEY--
2334
01:03:11,088 --> 01:03:12,489
THEY'RE UNHAPPY PAYING
2335
01:03:12,489 --> 01:03:13,958
ACCOUNTANTS AND OTHERS TO--
2336
01:03:13,958 --> 01:03:14,959
EVEN THOUGH THEY KNOW
2337
01:03:14,959 --> 01:03:15,960
THEY HAVE TO KEEP
2338
01:03:15,960 --> 01:03:17,027
FAR TOO MANY RECORDS,
2339
01:03:17,027 --> 01:03:18,495
IT'S TOUGH FOR THEM
2340
01:03:18,495 --> 01:03:19,997
TO SAY, WELL, LET'S GO
2341
01:03:19,997 --> 01:03:21,465
TO A SIMPLIFIED SYSTEM
2342
01:03:21,465 --> 01:03:23,233
THAT THEY DON'T REALLY KNOW
2343
01:03:23,233 --> 01:03:24,234
AND THEY DON'T
2344
01:03:24,234 --> 01:03:25,235
NECESSARILY TRUST.
2345
01:03:25,235 --> 01:03:26,503
"ARE YOU GONNA CUT OUT
2346
01:03:26,503 --> 01:03:27,571
ALL OF MY DEDUCTIONS,
2347
01:03:27,571 --> 01:03:28,572
OR MOST OF THEM?
2348
01:03:28,572 --> 01:03:29,874
TAX ME ON A LOT OF FRINGE
2349
01:03:29,874 --> 01:03:31,541
BENEFITS AND OTHER THINGS?
2350
01:03:31,541 --> 01:03:32,542
AND THEN ONCE
2351
01:03:32,542 --> 01:03:34,211
YOU HAVE THEM GONE,
2352
01:03:34,211 --> 01:03:35,479
ARE YOU GONNA UP MY TAX RATES
2353
01:03:35,479 --> 01:03:36,981
ABOVE WHAT YOU SAID?
2354
01:03:36,981 --> 01:03:38,348
CAN I TRUST YOU?"
2355
01:03:38,348 --> 01:03:40,017
SO, HOW DO YOU BUILD
2356
01:03:40,017 --> 01:03:41,852
A REFORM MOVEMENT
2357
01:03:41,852 --> 01:03:44,321
THAT IS BUILT ON TRUST
2358
01:03:44,321 --> 01:03:45,990
RATHER THAN JUST PROMISES?
2359
01:03:45,990 --> 01:03:47,091
AND I THINK THAT'S ONE
2360
01:03:47,091 --> 01:03:48,392
OF THE GREAT CHALLENGES.
2361
01:03:48,392 --> 01:03:49,526
>> IF YOU'VE AN ACTIVIST
2362
01:03:49,526 --> 01:03:50,594
OUT THERE AND YOU WANT
2363
01:03:50,594 --> 01:03:51,929
TO MAKE AMERICA BETTER,
2364
01:03:51,929 --> 01:03:53,030
YOU WANT OUR TAX SYSTEM
2365
01:03:53,030 --> 01:03:54,498
TO BE SIMPLE AND FAIR,
2366
01:03:54,498 --> 01:03:56,633
WHAT'S THE BEST WAY TO GO?
2367
01:03:56,633 --> 01:03:58,002
>> Man: WHAT WOULD HE LIKE
2368
01:03:58,002 --> 01:03:59,003
FOR DINNER?
2369
01:03:59,003 --> 01:04:00,437
HE JUST LOVES CHOCOLATE CAKE.
2370
01:04:00,437 --> 01:04:02,506
GO AHEAD, TRY ONE.
2371
01:04:02,506 --> 01:04:03,507
ALL YOU HAVE TO DO
2372
01:04:03,507 --> 01:04:04,975
IS FOLLOW THE RECIPE.
2373
01:04:04,975 --> 01:04:07,144
THIS IS GOING TO BE EASY.
2374
01:04:07,144 --> 01:04:09,146
LET'S SEE, WHAT'S NEXT?
2375
01:04:09,146 --> 01:04:10,414
>> THE GOAL OF FUNDAMENTAL
2376
01:04:10,414 --> 01:04:11,415
TAX REFORM SHOULD BE
2377
01:04:11,415 --> 01:04:12,582
SIMPLICITY, NUMBER ONE.
2378
01:04:12,582 --> 01:04:13,583
YOU KNOW, WE HAVE
2379
01:04:13,583 --> 01:04:14,651
AN AMAZINGLY COMPLEX
2380
01:04:14,651 --> 01:04:17,154
TAX SYSTEM, UH, THAT, UH,
2381
01:04:17,154 --> 01:04:18,889
BY SOME ESTIMATES
2382
01:04:18,889 --> 01:04:20,224
COSTS AMERICANS
2383
01:04:20,224 --> 01:04:22,192
OVER $280 BILLION A YEAR
2384
01:04:22,192 --> 01:04:23,593
TO COMPLY WITH.
2385
01:04:23,593 --> 01:04:24,594
>> YOU MUST STIR
2386
01:04:24,594 --> 01:04:25,595
THE INGREDIENTS
2387
01:04:25,595 --> 01:04:26,931
IN YOUR CHOCOLATE CAKE.
2388
01:04:26,931 --> 01:04:27,932
TO STIR IS
2389
01:04:27,932 --> 01:04:28,999
TO MIX FOOD MATERIALS
2390
01:04:28,999 --> 01:04:30,167
WITH A CIRCULAR MOTION
2391
01:04:30,167 --> 01:04:31,635
TO SECURE A UNIFORM
2392
01:04:31,635 --> 01:04:33,403
CONSISTENCY.
2393
01:04:33,403 --> 01:04:34,638
>> YOU REALLY HAVE TO THINK
2394
01:04:34,638 --> 01:04:36,173
ABOUT REFORMING THE TAX CODE
2395
01:04:36,173 --> 01:04:37,274
EITHER INCREMENTALLY
2396
01:04:37,274 --> 01:04:39,910
OR AS ONE BIG CHANGE.
2397
01:04:39,910 --> 01:04:41,078
UH, THERE'S REALLY ABOUT
2398
01:04:41,078 --> 01:04:43,447
50 REASONS, AND THEY ARE CHINA,
2399
01:04:43,447 --> 01:04:45,582
INDIA, JAPAN, MALAYSIA...
2400
01:04:45,582 --> 01:04:46,917
YOU NAME THE COUNTRY.
2401
01:04:46,917 --> 01:04:47,918
SOUTH KOREA
2402
01:04:47,918 --> 01:04:49,319
AND THE ENTIRE EUROPEAN UNION.
2403
01:04:49,319 --> 01:04:50,587
EVERYBODY IN THE WORLD
2404
01:04:50,587 --> 01:04:51,588
IS WORKING TO BECOME
2405
01:04:51,588 --> 01:04:52,589
MORE COMPETITIVE.
2406
01:04:52,589 --> 01:04:54,358
IT IS A COMPETITIVE
2407
01:04:54,358 --> 01:04:55,359
GLOBAL ECONOMY.
2408
01:04:55,359 --> 01:04:56,961
EVERYONE'S TRYING TO COMPETE,
2409
01:04:56,961 --> 01:04:58,195
BECAUSE IF YOU CAN COMPETE
2410
01:04:58,195 --> 01:04:59,429
BETTER, YOU PROSPER MORE.
2411
01:04:59,429 --> 01:05:01,198
>> BUT YOU REALLY HAVE TO ASK
2412
01:05:01,198 --> 01:05:02,599
IF THE ONLY PART OF THE COUNTRY
2413
01:05:02,599 --> 01:05:03,700
THAT'S REALLY BOOMING
2414
01:05:03,700 --> 01:05:05,035
IS THE CAPITAL, IS THERE
2415
01:05:05,035 --> 01:05:06,036
SOMETHING WRONG
2416
01:05:06,036 --> 01:05:07,071
WITH THE GOVERNMENT,
2417
01:05:07,071 --> 01:05:08,138
AND I THINK THERE IS.
2418
01:05:08,138 --> 01:05:09,339
IT'S TOO SELF-CENTERED.
2419
01:05:09,339 --> 01:05:10,440
IT'S TOO WORRIED ABOUT
2420
01:05:10,440 --> 01:05:11,541
ITS OWN WELL-BEING,
2421
01:05:11,541 --> 01:05:13,077
AND IT IS NOT DOING
2422
01:05:13,077 --> 01:05:14,078
WHAT IS NECESSARY
2423
01:05:14,078 --> 01:05:15,579
TO MAKE THE COUNTRY GROW.
2424
01:05:15,579 --> 01:05:16,613
>> CREAM BUTTER MEANS
2425
01:05:16,613 --> 01:05:17,614
TO MANIPULATE
2426
01:05:17,614 --> 01:05:18,615
WITH AN INSTRUMENT
2427
01:05:18,615 --> 01:05:19,683
UNTIL IT BECOMES SOFT
2428
01:05:19,683 --> 01:05:21,251
AND SMOOTH.
2429
01:05:21,251 --> 01:05:22,252
>> WHEN YOU FIND YOURSELF
2430
01:05:22,252 --> 01:05:23,253
SITTING DOWN AND RUNNING NUMBERS
2431
01:05:23,253 --> 01:05:24,288
TO FIGURE OUT WHERE IT MAKES
2432
01:05:24,288 --> 01:05:25,489
MORE SENSE FOR YOU TO LIVE
2433
01:05:25,489 --> 01:05:26,523
AND WHAT KIND OF HOUSE
2434
01:05:26,523 --> 01:05:28,058
YOU SHOULD HAVE, YOU REALIZE
2435
01:05:28,058 --> 01:05:29,159
THE EXTENT TO WHICH TAX
2436
01:05:29,159 --> 01:05:30,160
ACTUALLY CONTROLS
2437
01:05:30,160 --> 01:05:31,561
YOUR DAY-TO-DAY CHOICES.
2438
01:05:31,561 --> 01:05:33,030
>> WE LIKE TO USE THE TAX CODE
2439
01:05:33,030 --> 01:05:34,264
TO DO LITTLE TOKEN THINGS,
2440
01:05:34,264 --> 01:05:35,265
AND WE'VE BEEN DOING
2441
01:05:35,265 --> 01:05:37,334
MORE OF THOSE IN THE PAST
2442
01:05:37,334 --> 01:05:39,336
20 YEARS, AND THAT'S WHY
2443
01:05:39,336 --> 01:05:40,470
WE HAVE THESE FOUR-PAGE
2444
01:05:40,470 --> 01:05:41,638
TAX RETURNS.
2445
01:05:41,638 --> 01:05:43,107
>> THIS SOCIAL ENGINEERING
2446
01:05:43,107 --> 01:05:44,308
BUSINESS-- THEY GIVE YOU
2447
01:05:44,308 --> 01:05:46,310
A HOUSING INTEREST TAX CREDIT
2448
01:05:46,310 --> 01:05:47,611
SO YOU'LL BUY A HOME,
2449
01:05:47,611 --> 01:05:48,645
AND THEN THEY GIVE YOU
2450
01:05:48,645 --> 01:05:49,646
A MARRIAGE PENALTY
2451
01:05:49,646 --> 01:05:50,647
SO YOU'LL LIVE IN IT
2452
01:05:50,647 --> 01:05:51,648
OUT OF WEDLOCK.
2453
01:05:51,648 --> 01:05:52,983
WHAT ARE THEY TRYING TO DO?
2454
01:05:52,983 --> 01:05:54,051
JUST LEAVE PEOPLE ALONE.
2455
01:05:54,051 --> 01:05:55,585
>> THAT'S RIGHT, POUR IT IN.
2456
01:05:55,585 --> 01:05:57,254
THE RECIPE SAYS "CREAM
2457
01:05:57,254 --> 01:05:58,455
THE BUTTER," SO PUT IN
2458
01:05:58,455 --> 01:06:00,524
LOTS OF CREAM.
2459
01:06:00,524 --> 01:06:01,525
>> WE USE THE TAX CODE
2460
01:06:01,525 --> 01:06:02,526
FOR A LOT OF THINGS
2461
01:06:02,526 --> 01:06:04,528
OTHER THAN JUST COLLECTING TAX,
2462
01:06:04,528 --> 01:06:06,063
AND ACTUALLY, A LOT OF TIMES,
2463
01:06:06,063 --> 01:06:07,164
WE'RE NOT VERY SERIOUS
2464
01:06:07,164 --> 01:06:08,365
ABOUT COLLECTING TAX!
2465
01:06:08,365 --> 01:06:09,366
>> THERE'S OVER
2466
01:06:09,366 --> 01:06:10,667
$300 BILLION A YEAR--
2467
01:06:10,667 --> 01:06:13,003
$300 BILLION A YEAR
2468
01:06:13,003 --> 01:06:15,005
OF TAXES THAT ARE NOT PAID
2469
01:06:15,005 --> 01:06:16,640
THAT-- THAT SHOULD BE PAID,
2470
01:06:16,640 --> 01:06:17,774
YOU KNOW, UNDER THE LAW.
2471
01:06:17,774 --> 01:06:19,076
SO, LOOK AT IT THAT WAY,
2472
01:06:19,076 --> 01:06:20,144
THAT MEANS EVERYBODY
2473
01:06:20,144 --> 01:06:21,278
THAT'S HONESTLY PAYING
2474
01:06:21,278 --> 01:06:22,279
IS PAYING 20% MORE
2475
01:06:22,279 --> 01:06:23,280
THAN THEY NEED TO
2476
01:06:23,280 --> 01:06:24,448
TO MAKE UP FOR THE $300 BILLION
2477
01:06:24,448 --> 01:06:25,549
THAT'S NOT BEING PAID.
2478
01:06:25,549 --> 01:06:27,151
SO, WHEN YOU ADD THAT TOGETHER,
2479
01:06:27,151 --> 01:06:29,119
THAT'S AN ENORMOUS INEFFICIENCY.
2480
01:06:29,119 --> 01:06:30,154
>> JUST LOOK AT THAT
2481
01:06:30,154 --> 01:06:31,521
SILKY SMOOTH TEXTURE
2482
01:06:31,521 --> 01:06:33,023
OF THAT BATTER.
2483
01:06:33,023 --> 01:06:35,625
>> SNEAK, UH, TAXES.
2484
01:06:35,625 --> 01:06:37,694
WE SOMETIMES GET A TAX INCREASE
2485
01:06:37,694 --> 01:06:39,096
AND WE DON'T EVEN KNOW IT,
2486
01:06:39,096 --> 01:06:40,097
BECAUSE THE CODE
2487
01:06:40,097 --> 01:06:41,098
IS SO COMPLICATED.
2488
01:06:41,098 --> 01:06:42,566
I'VE BEEN HIT WITH SNEAK ATTACKS
2489
01:06:42,566 --> 01:06:44,101
MANY, MANY, MANY TIMES,
2490
01:06:44,101 --> 01:06:45,569
AND DIDN'T REALIZE IT
2491
01:06:45,569 --> 01:06:47,804
UNTIL AFTER THE FACT.
2492
01:06:47,804 --> 01:06:50,040
>> I THINK PEOPLE WANT A--
2493
01:06:50,040 --> 01:06:51,041
THE SIMPLEST--
2494
01:06:51,041 --> 01:06:52,176
THE SIMPLEST TAX SYSTEM
2495
01:06:52,176 --> 01:06:53,777
WE CAN POSSIBLY GIVE THEM,
2496
01:06:53,777 --> 01:06:55,812
AND-- AND-- AND ONE
2497
01:06:55,812 --> 01:06:57,047
THAT'S TRANSPARENT,
2498
01:06:57,047 --> 01:06:58,448
THAT THEY CAN UNDERSTAND, UH,
2499
01:06:58,448 --> 01:07:00,450
WHERE-- WHY THEY HAVE TO PAY
2500
01:07:00,450 --> 01:07:01,451
THE AMOUNT OF TAX
2501
01:07:01,451 --> 01:07:02,652
THEY HAVE TO PAY.
2502
01:07:02,652 --> 01:07:04,554
>> NO, MARGIE, YOUR CAKE
2503
01:07:04,554 --> 01:07:05,622
DIDN'T TURN OUT SO WELL
2504
01:07:05,622 --> 01:07:07,591
BECAUSE YOU MISUNDERSTOOD
2505
01:07:07,591 --> 01:07:09,626
A TERM IN YOUR COOKBOOK.
2506
01:07:09,626 --> 01:07:10,627
>> ONE OF THE THINGS
2507
01:07:10,627 --> 01:07:12,429
THAT, UH, PEOPLE TALK ABOUT
2508
01:07:12,429 --> 01:07:13,530
IN TERMS OF THE TAX CODE
2509
01:07:13,530 --> 01:07:14,598
IS WHETHER IT'S FAIR,
2510
01:07:14,598 --> 01:07:15,699
AND THAT'S, OF COURSE,
2511
01:07:15,699 --> 01:07:18,135
A VERY GENERAL TERM
2512
01:07:18,135 --> 01:07:20,370
THAT IS, UH, VERY SUBJECT
2513
01:07:20,370 --> 01:07:21,371
TO INTERPRETATION
2514
01:07:21,371 --> 01:07:22,372
AS TO WHAT EVERYBODY
2515
01:07:22,372 --> 01:07:23,573
THINKS IS FAIR.
2516
01:07:23,573 --> 01:07:24,674
>> WE HAVE TO RECOGNIZE
2517
01:07:24,674 --> 01:07:26,210
THAT THERE ARE INEQUALITIES
2518
01:07:26,210 --> 01:07:27,211
IN THE COUNTRY.
2519
01:07:27,211 --> 01:07:28,478
THERE ARE TENSIONS BECAUSE
2520
01:07:28,478 --> 01:07:29,746
OF ECONOMIC INEQUALITIES.
2521
01:07:29,746 --> 01:07:30,747
WE NEED TO DEBATE
2522
01:07:30,747 --> 01:07:32,316
WHY THOSE INEQUALITIES
2523
01:07:32,316 --> 01:07:33,350
HAVE COME ABOUT,
2524
01:07:33,350 --> 01:07:34,751
AND WE NEED TO DEBATE
2525
01:07:34,751 --> 01:07:36,420
HOW MUCH WE WANNA DO
2526
01:07:36,420 --> 01:07:38,488
TO LEVEL OUT THOSE INEQUALITIES,
2527
01:07:38,488 --> 01:07:40,090
BECAUSE ONLY IF WE HAVE
2528
01:07:40,090 --> 01:07:41,525
THAT DEBATE CAN WE PROCEED
2529
01:07:41,525 --> 01:07:42,559
INTELLIGENTLY.
2530
01:07:42,559 --> 01:07:44,094
>> LATER, YOU MAY BE REQUIRED
2531
01:07:44,094 --> 01:07:45,262
TO BEAT EGG WHITES STIFF,
2532
01:07:45,262 --> 01:07:47,531
BUT NOT DRY, OR SO THAT THEY
2533
01:07:47,531 --> 01:07:48,732
HOLD THE GREATEST AMOUNT
2534
01:07:48,732 --> 01:07:50,267
OF AIR WITHOUT LOSING
2535
01:07:50,267 --> 01:07:51,868
THEIR ELASTICITY.
2536
01:07:51,868 --> 01:07:53,170
>> YOU NEED TO MAKE SURE
2537
01:07:53,170 --> 01:07:54,304
THAT YOU'RE GENERATING
2538
01:07:54,304 --> 01:07:55,505
ENOUGH REVENUE, AT LEAST
2539
01:07:55,505 --> 01:07:56,606
OVER A BUSINESS CYCLE,
2540
01:07:56,606 --> 01:07:57,607
WHERE YOU CAN PAY
2541
01:07:57,607 --> 01:07:58,608
YOUR CURRENT BILLS,
2542
01:07:58,608 --> 01:07:59,743
AND WHERE, ULTIMATELY,
2543
01:07:59,743 --> 01:08:01,778
OVER TIME, YOU'RE PROJECTED
2544
01:08:01,778 --> 01:08:03,613
TO GENERATED ENOUGH REVENUE
2545
01:08:03,613 --> 01:08:05,182
THAT YOU CAN KEEP THE PROMISES
2546
01:08:05,182 --> 01:08:06,783
THAT YOU INTEND TO KEEP,
2547
01:08:06,783 --> 01:08:08,252
AND THAT'S WHAT WASHINGTON
2548
01:08:08,252 --> 01:08:09,753
HAS FAILED ON.
2549
01:08:09,753 --> 01:08:11,121
>> YES, EVEN MARGIE FOUND
2550
01:08:11,121 --> 01:08:12,389
THAT SHE COULD LEARN TO COOK
2551
01:08:12,389 --> 01:08:13,390
WHEN SHE DISCOVERED
2552
01:08:13,390 --> 01:08:14,791
THE SIGNIFICANCE OF THE TERMS
2553
01:08:14,791 --> 01:08:15,892
USED IN COOKING...
2554
01:08:15,892 --> 01:08:17,827
AND TIM WILL NEVER KNOW
2555
01:08:17,827 --> 01:08:19,829
SHE RUINED HER FIRST CAKE.
2556
01:08:24,701 --> 01:08:26,270
>> WHAT COALESCENCE OF THINGS,
2557
01:08:26,270 --> 01:08:27,304
WHAT CAN HAPPEN
2558
01:08:27,304 --> 01:08:29,139
THAT MAKES TAX REFORM POSSIBLE?
2559
01:08:29,139 --> 01:08:30,807
YOU NEED A STRONG PRESIDENT.
2560
01:08:30,807 --> 01:08:32,309
MY GUESS IS THAT IT WOULD HAVE
2561
01:08:32,309 --> 01:08:33,310
TO BE IN A SECOND--
2562
01:08:33,310 --> 01:08:34,344
A SECOND TERM.
2563
01:08:34,344 --> 01:08:37,747
UH, SECONDLY, YOU NEED LEADERS
2564
01:08:37,747 --> 01:08:39,183
WITHIN THE PARTY
2565
01:08:39,183 --> 01:08:40,684
WHO SAY IN THE BACK ROOMS,
2566
01:08:40,684 --> 01:08:42,519
"LOOK IT, THIS IS SERIOUS.
2567
01:08:42,519 --> 01:08:43,620
WE NEED TO GET TOGETHER
2568
01:08:43,620 --> 01:08:44,621
AND PROVIDE
2569
01:08:44,621 --> 01:08:46,323
THE CONGRESSIONAL LEADERSHIP."
2570
01:08:46,323 --> 01:08:47,524
AND, THIRD, IT NEEDS TO BE
2571
01:08:47,524 --> 01:08:48,792
SOME GRASSROOTS MOVEMENT.
2572
01:08:48,792 --> 01:08:49,826
MOST GREAT MOVEMENTS
2573
01:08:49,826 --> 01:08:50,827
ACTUALLY COME FROM
2574
01:08:50,827 --> 01:08:53,297
THE GRASSROOTS.
2575
01:08:53,297 --> 01:08:54,298
SO, YOU NEED ALL
2576
01:08:54,298 --> 01:08:55,299
OF THOSE ELEMENTS,
2577
01:08:55,299 --> 01:08:57,734
AND I'M STILL OPTIMISTIC ENOUGH
2578
01:08:57,734 --> 01:08:58,735
ABOUT THIS COUNTRY
2579
01:08:58,735 --> 01:09:00,370
AND ITS PEOPLE TO BELIEVE
2580
01:09:00,370 --> 01:09:02,172
THAT WE'RE CAPABLE OF THAT.
2581
01:09:02,172 --> 01:09:03,573
>> I DON'T KNOW THAT MANY PEOPLE
2582
01:09:03,573 --> 01:09:05,609
WHO LIKE TO PAY TAXES,
2583
01:09:05,609 --> 01:09:08,445
BUT TAXES ARE A NECESSARY THING
2584
01:09:08,445 --> 01:09:09,879
WHEN YOU ARE TRYING TO FINANCE
2585
01:09:09,879 --> 01:09:11,648
A GOVERNMENT, AND TO MEET
2586
01:09:11,648 --> 01:09:12,749
THE BROADER INTERESTS
2587
01:09:12,749 --> 01:09:14,484
OF SOCIETY THAT OTHERWISE
2588
01:09:14,484 --> 01:09:15,785
CAN'T BE MET
2589
01:09:15,785 --> 01:09:16,886
BY THE PRIVATE SECTOR,
2590
01:09:16,886 --> 01:09:17,887
OR AREN'T BEING MET
2591
01:09:17,887 --> 01:09:19,489
BY OTHER LEVELS OF GOVERNMENT,
2592
01:09:19,489 --> 01:09:20,490
LIKE THE STATE
2593
01:09:20,490 --> 01:09:21,791
AND LOCAL LEVEL OF GOVERNMENT,
2594
01:09:21,791 --> 01:09:22,792
IN THE CASE
2595
01:09:22,792 --> 01:09:24,261
OF THE FEDERAL GOVERNMENT.
2596
01:09:24,261 --> 01:09:25,595
SO THEY'RE A NECESSARY EVIL.
2597
01:09:25,595 --> 01:09:26,696
>> THERE IS ANOTHER WAY
2598
01:09:26,696 --> 01:09:27,697
OF LOOKING AT TAXES.
2599
01:09:27,697 --> 01:09:28,698
THE OTHER WAY OF
2600
01:09:28,698 --> 01:09:29,833
LOOKING AT TAXES IS THAT
2601
01:09:29,833 --> 01:09:31,935
WHEN APRIL 15th COMES ALONG,
2602
01:09:31,935 --> 01:09:34,738
YOU'RE HAPPY BECAUSE YOU CAN
2603
01:09:34,738 --> 01:09:35,839
CONTRIBUTE AS A MEMBER
2604
01:09:35,839 --> 01:09:37,841
OF THE COMMUNITY TO ACHIEVING
2605
01:09:37,841 --> 01:09:39,276
THE COMMUNITY GOALS
2606
01:09:39,276 --> 01:09:40,344
THAT ARE ESTABLISHED
2607
01:09:40,344 --> 01:09:41,511
BY A DEMOCRATIC
2608
01:09:41,511 --> 01:09:42,912
PARTICIPATORY PROCESS.
2609
01:09:42,912 --> 01:09:44,814
IN THAT SENSE,
2610
01:09:44,814 --> 01:09:46,683
TAXES ARE A GOOD THING.
2611
01:09:46,683 --> 01:09:47,951
>> YOU KNOW, THE WAY YOU TAX,
2612
01:09:47,951 --> 01:09:49,219
A LOT OF PEOPLE ARGUE,
2613
01:09:49,219 --> 01:09:50,420
REALLY DEFINES WHAT YOU ARE
2614
01:09:50,420 --> 01:09:51,655
AS A COUNTRY.
2615
01:09:51,655 --> 01:09:52,722
>> WE'RE GOING TO HAVE
2616
01:09:52,722 --> 01:09:53,990
TO FIND A WAY TO-- TO PAY
2617
01:09:53,990 --> 01:09:55,359
NOT ONLY FOR ALL THE DEBTS
2618
01:09:55,359 --> 01:09:56,693
WE'RE ACCUMULATING RIGHT NOW,
2619
01:09:56,693 --> 01:09:57,694
BUT ALSO TO PAY
2620
01:09:57,694 --> 01:09:59,629
FOR ALL OF THE PROMISES
2621
01:09:59,629 --> 01:10:01,565
WE'VE MADE TO SENIOR CITIZENS,
2622
01:10:01,565 --> 01:10:02,766
UH, AND YOU NEED
2623
01:10:02,766 --> 01:10:03,833
A WORKING TAX SYSTEM.
2624
01:10:03,833 --> 01:10:04,834
YOU NEED A TAX SYSTEM
2625
01:10:04,834 --> 01:10:06,236
THAT'S PERCEIVED AS FAIR
2626
01:10:06,236 --> 01:10:07,537
AND CAN RAISE ENOUGH REVENUE.
2627
01:10:07,537 --> 01:10:08,605
IT'S GONNA NEED TO RAISE
2628
01:10:08,605 --> 01:10:09,606
A LOT MORE REVENUE
2629
01:10:09,606 --> 01:10:10,607
THAN THE CURRENT SYSTEM.
2630
01:10:10,607 --> 01:10:12,309
THE CONGRESSIONAL BUDGET OFFICE
2631
01:10:12,309 --> 01:10:13,577
PROJECTS THAT IF CURRENT--
2632
01:10:13,577 --> 01:10:14,944
IF CURRENT TRENDS CONTINUE--
2633
01:10:14,944 --> 01:10:16,246
HEALTH COSTS CONTINUE
2634
01:10:16,246 --> 01:10:17,647
TO GROW FASTER THAN THE ECONOMY
2635
01:10:17,647 --> 01:10:18,648
AND BABY BOOMERS AGE
2636
01:10:18,648 --> 01:10:21,318
AND RETIRE-- UH, THAT SPENDING
2637
01:10:21,318 --> 01:10:22,319
ON THREE PROGRAMS
2638
01:10:22,319 --> 01:10:23,320
FOR THE ELDERLY--
2639
01:10:23,320 --> 01:10:24,588
SOCIAL SECURITY, MEDICAID,
2640
01:10:24,588 --> 01:10:25,855
AND MEDICARE-- WILL TAKE UP
2641
01:10:25,855 --> 01:10:26,856
18% OF GDP.
2642
01:10:26,856 --> 01:10:28,758
THAT IS THE HISTORICAL AVERAGE
2643
01:10:28,758 --> 01:10:29,759
OF ALL SPENDING
2644
01:10:29,759 --> 01:10:31,328
FOR THE GOVERNMENT.
2645
01:10:31,328 --> 01:10:32,529
>> Fox: YOU'VE GOTTA COME
2646
01:10:32,529 --> 01:10:33,563
TO TERMS WITH THE FACT
2647
01:10:33,563 --> 01:10:34,831
THAT OVER THE LONG RUN,
2648
01:10:34,831 --> 01:10:36,400
WE CAN'T AFFORD THE BENEFITS
2649
01:10:36,400 --> 01:10:38,268
WITHOUT INCREASING THE TAXES,
2650
01:10:38,268 --> 01:10:39,303
AND YOU CAN'T IMAGINE
2651
01:10:39,303 --> 01:10:40,837
ANYBODY SAYING THAT.
2652
01:10:40,837 --> 01:10:42,406
NOW, OBVIOUSLY, THE CANDIDATES
2653
01:10:42,406 --> 01:10:43,607
ARE SAYING, "WE'RE GONNA HAVE
2654
01:10:43,607 --> 01:10:44,608
YOU PAY LESS TAXES."
2655
01:10:44,608 --> 01:10:45,842
>> WE CAN'T AFFORD TO LOWER
2656
01:10:45,842 --> 01:10:46,843
ANYBODY'S TAXES,
2657
01:10:46,843 --> 01:10:47,944
AND THE ONLY WAY YOU CAN
2658
01:10:47,944 --> 01:10:49,679
GET REGULAR, AVERAGE PEOPLE'S
2659
01:10:49,679 --> 01:10:51,815
ATTENTION ABOUT TAX REFORM
2660
01:10:51,815 --> 01:10:52,816
IS IF YOU TELL 'EM
2661
01:10:52,816 --> 01:10:54,918
YOU ARE GONNA LOWER THEIR TAXES.
2662
01:10:54,918 --> 01:10:56,019
THERE-- YOU KNOW, IF YOU JUST
2663
01:10:56,019 --> 01:10:57,020
SAY, "WELL, WE'RE GONNA
2664
01:10:57,020 --> 01:10:58,455
REARRANGE, AND YOU'RE GONNA
2665
01:10:58,455 --> 01:10:59,689
PAY ABOUT THE SAME AMOUNT,"
2666
01:10:59,689 --> 01:11:00,690
THEY'RE NOT GONNA WANT
2667
01:11:00,690 --> 01:11:01,558
TO LISTEN TO THAT.
2668
01:11:01,558 --> 01:11:03,693
>> SOMETIMES YOU HAVE TO MAKE
2669
01:11:03,693 --> 01:11:05,395
CHOICES THAT DON'T SOUND
2670
01:11:05,395 --> 01:11:07,063
POLITICALLY CONVENIENT,
2671
01:11:07,063 --> 01:11:08,432
BECAUSE THE ALTERNATIVE
2672
01:11:08,432 --> 01:11:10,400
IS JUST TOO DREADFUL TO IMAGINE.
2673
01:11:10,400 --> 01:11:12,602
>> UNTIL THERE IS A CONCEPTION
2674
01:11:12,602 --> 01:11:14,338
OF PARTICIPATING
2675
01:11:14,338 --> 01:11:15,839
IN A DEMOCRATIC SOCIETY,
2676
01:11:15,839 --> 01:11:17,941
AND A CONCEPTION WHICH IS REAL,
2677
01:11:17,941 --> 01:11:19,876
NOT JUST WORDS, BUT IT MEANS
2678
01:11:19,876 --> 01:11:21,445
YOU REALLY ARE PARTICIPATING
2679
01:11:21,445 --> 01:11:22,712
IN A DEMOCRATIC SOCIETY--
2680
01:11:22,712 --> 01:11:23,813
UNTIL THAT'S THE CASE,
2681
01:11:23,813 --> 01:11:24,948
DISCUSSION OF TAXES IS,
2682
01:11:24,948 --> 01:11:27,651
UH, FIDDLING WITH TECHNICALITIES
2683
01:11:27,651 --> 01:11:29,919
AND MISSING THE POINT.
2684
01:11:29,919 --> 01:11:31,455
>> Fox: WHAT'S HAPPENED IS
2685
01:11:31,455 --> 01:11:33,690
THAT WE FEEL LESS CONNECTED,
2686
01:11:33,690 --> 01:11:36,025
AND SO THE APPEAL
2687
01:11:36,025 --> 01:11:37,093
NOT TO PAY TAXES--
2688
01:11:37,093 --> 01:11:38,094
IT'S YOUR MONEY;
2689
01:11:38,094 --> 01:11:40,564
YOU CAN DO BETTER WITH IT--
2690
01:11:40,564 --> 01:11:42,999
MEANS THAT WHY ARE YOU HELPING
2691
01:11:42,999 --> 01:11:44,601
SOMEBODY ELSE WHO DOESN'T
2692
01:11:44,601 --> 01:11:46,035
HAVE SOME IMMEDIATE CONNECTION
2693
01:11:46,035 --> 01:11:47,637
TO YOUR FAMILY OR NEIGHBORHOOD
2694
01:11:47,637 --> 01:11:48,638
OR COMMUNITY?
2695
01:11:48,638 --> 01:11:50,640
IT USED TO BE PEOPLE WENT
2696
01:11:50,640 --> 01:11:52,642
TO SCHOOL WITH THE PEOPLE
2697
01:11:52,642 --> 01:11:53,643
THEY WORKED WITH,
2698
01:11:53,643 --> 01:11:56,346
AND-- AND MANAGERS, OWNERS,
2699
01:11:56,346 --> 01:11:58,848
THEIR KIDS, WORKERS,
2700
01:11:58,848 --> 01:11:59,949
YOU KNOW, BLUE COLLAR,
2701
01:11:59,949 --> 01:12:00,950
WHITE COLLAR--
2702
01:12:00,950 --> 01:12:02,719
THERE WAS AN ENORMOUS MIX
2703
01:12:02,719 --> 01:12:03,920
AND INTERACTION.
2704
01:12:03,920 --> 01:12:04,921
AND I THINK THERE WAS
2705
01:12:04,921 --> 01:12:06,756
A MUCH GREATER SENSE OF--
2706
01:12:06,756 --> 01:12:08,758
THAT WE'RE ALL IN THIS TOGETHER.
2707
01:12:08,758 --> 01:12:09,959
IN ORDER FOR THESE THINGS
2708
01:12:09,959 --> 01:12:11,861
TO HAPPEN AGAIN, SOMEHOW
2709
01:12:11,861 --> 01:12:13,630
WE MUST CAPTURE THAT SENSE
2710
01:12:13,630 --> 01:12:16,733
THAT WE ARE A-- ONE NATION.
2711
01:12:16,733 --> 01:12:18,902
YOU KNOW, WE ARE A COMMUNITY,
2712
01:12:18,902 --> 01:12:20,870
AND THEN WE HAVE TO DECIDE,
2713
01:12:20,870 --> 01:12:21,871
WELL, WHAT IS IT
2714
01:12:21,871 --> 01:12:23,373
THAT THE FEDERAL GOVERNMENT
2715
01:12:23,373 --> 01:12:24,508
SHOULD DO, AS OPPOSED TO
2716
01:12:24,508 --> 01:12:25,909
THE STATE OR LOCAL GOVERNMENT,
2717
01:12:25,909 --> 01:12:27,043
AS OPPOSED TO OURSELVES
2718
01:12:27,043 --> 01:12:28,044
INDIVIDUALLY?
2719
01:12:28,044 --> 01:12:29,513
THOSE ARE TOUGH DECISIONS,
2720
01:12:29,513 --> 01:12:30,647
BUT WHAT CAN THE FEDERAL
2721
01:12:30,647 --> 01:12:31,981
GOVERNMENT DO BEST,
2722
01:12:31,981 --> 01:12:33,750
AND WHAT SHOULDN'T IT DO?
2723
01:12:33,750 --> 01:12:36,052
AND WE NEED THOSE CONVERSATIONS
2724
01:12:36,052 --> 01:12:37,053
TO BE GOING ON
2725
01:12:37,053 --> 01:12:39,556
THROUGHOUT THE COUNTRY.
2726
01:12:49,032 --> 01:12:50,534
>> Thorndike: YOU KNOW, THERE'S
2727
01:12:50,534 --> 01:12:51,601
A REASON WHY I'VE SPENT MY LIFE
2728
01:12:51,601 --> 01:12:52,602
ON THIS ISSUE.
2729
01:12:52,602 --> 01:12:53,703
IT'S THAT IT IS SIMPLY
2730
01:12:53,703 --> 01:12:55,839
TOO IMPORTANT TO IGNORE,
2731
01:12:55,839 --> 01:12:58,575
AND INERTIA IS SO STRONG
2732
01:12:58,575 --> 01:13:02,045
THAT IT REQUIRES ALL OF US
2733
01:13:02,045 --> 01:13:03,880
TO PAY ATTENTION
2734
01:13:03,880 --> 01:13:04,948
SO THAT THE TAX SYSTEM
2735
01:13:04,948 --> 01:13:06,683
DOESN'T JUST GET WORSE,
2736
01:13:06,683 --> 01:13:07,684
DOESN'T JUST GET
2737
01:13:07,684 --> 01:13:08,685
MORE COMPLICATED,
2738
01:13:08,685 --> 01:13:09,686
DOESN'T JUST GET
2739
01:13:09,686 --> 01:13:10,687
MORE INEFFICIENT.
2740
01:13:10,687 --> 01:13:12,422
OTHER PEOPLE WILL PAY ATTENTION.
2741
01:13:12,422 --> 01:13:13,423
THE WRONG PEOPLE
2742
01:13:13,423 --> 01:13:14,424
WILL PAY ATTENTION,
2743
01:13:14,424 --> 01:13:15,792
AND THEY'LL GET THE TAX SYSTEM
2744
01:13:15,792 --> 01:13:17,093
TO DO WHAT THEY WANT IT TO DO.
2745
01:13:17,093 --> 01:13:20,029
SO, IF AMERICANS AS A WHOLE
2746
01:13:20,029 --> 01:13:21,498
WANT TO PREVENT PEOPLE
2747
01:13:21,498 --> 01:13:23,500
FROM MAKING OUT LIKE BANDITS
2748
01:13:23,500 --> 01:13:24,568
AND WANT A TAX SYSTEM
2749
01:13:24,568 --> 01:13:25,935
THAT TREATS THEM FAIRLY
2750
01:13:25,935 --> 01:13:26,970
AND THAT IS GOOD
2751
01:13:26,970 --> 01:13:28,137
FOR THE COUNTRY AS A WHOLE,
2752
01:13:28,137 --> 01:13:29,706
THEY HAVE TO ENGAGE THIS TOPIC.
2753
01:13:29,706 --> 01:13:30,707
YOU CAN'T AVOID IT,
2754
01:13:30,707 --> 01:13:31,708
AND YOU CAN'T JUST
2755
01:13:31,708 --> 01:13:32,709
COMPLAIN ABOUT IT.
2756
01:13:32,709 --> 01:13:34,644
>> WHAT THE POLITICIANS FEAR,
2757
01:13:34,644 --> 01:13:36,446
IN THEIR HEART OF HEARTS,
2758
01:13:36,446 --> 01:13:37,847
THE WASHINGTON POLITICIANS,
2759
01:13:37,847 --> 01:13:39,082
I THINK, IS NOT A LOSS
2760
01:13:39,082 --> 01:13:40,083
OF REVENUE.
2761
01:13:40,083 --> 01:13:41,618
THEY KNOW, OVER TIME,
2762
01:13:41,618 --> 01:13:43,119
WASHINGTON WILL GET ITS--
2763
01:13:43,119 --> 01:13:44,588
ITS TAKE, WILL GET ITS CUT.
2764
01:13:44,588 --> 01:13:46,055
IT'LL DO JUST FINE.
2765
01:13:46,055 --> 01:13:47,123
WHAT THEY REALLY FEAR
2766
01:13:47,123 --> 01:13:48,725
IS THE LOSS OF POWER.
2767
01:13:48,725 --> 01:13:50,727
>> Boortz: WE HAVE A RIGHT,
2768
01:13:50,727 --> 01:13:52,796
WHEN GOVERNMENT BECOMES ABUSIVE,
2769
01:13:52,796 --> 01:13:54,598
OF LIBERTY TO ABOLISH
2770
01:13:54,598 --> 01:13:55,732
OR CHANGE GOVERNMENT.
2771
01:13:55,732 --> 01:13:58,201
THIS IS CHANGING GOVERNMENT.
2772
01:13:58,201 --> 01:13:59,903
>> UH, EVERY AMERICAN CITIZEN
2773
01:13:59,903 --> 01:14:00,904
SAY, "IF I DON'T LIKE
2774
01:14:00,904 --> 01:14:03,473
THIS TAX CODE,
2775
01:14:03,473 --> 01:14:05,241
I NEED TO SERIOUSLY DETERMINE
2776
01:14:05,241 --> 01:14:07,210
WHAT, IN MY MIND, IS A WORKABLE
2777
01:14:07,210 --> 01:14:09,212
OPTION AND GET BEHIND THAT."
2778
01:14:09,212 --> 01:14:11,615
>> IF TAXPAYERS DEMANDED IT,
2779
01:14:11,615 --> 01:14:13,483
THE POLITICIANS
2780
01:14:13,483 --> 01:14:14,618
AND THE POLITICAL LEADERS
2781
01:14:14,618 --> 01:14:15,685
WOULD RESPOND, AND WE COULD
2782
01:14:15,685 --> 01:14:16,853
GET A DRAMATICALLY BETTER
2783
01:14:16,853 --> 01:14:18,021
TAX SYSTEM FOR EVERYBODY.
2784
01:14:18,021 --> 01:14:20,089
>> WASHINGTON HAS OVERPROMISED
2785
01:14:20,089 --> 01:14:22,158
AND UNDERPERFORMED,
2786
01:14:22,158 --> 01:14:24,761
AND IT'S TIME THAT THAT STOP.
2787
01:14:24,761 --> 01:14:27,531
AND IT NEED TO STOP NOW.
2788
01:14:27,531 --> 01:14:28,732
>> I THINK EVERY AMERICAN
2789
01:14:28,732 --> 01:14:29,966
OUGHT TO START UNDERSTANDING
2790
01:14:29,966 --> 01:14:31,134
THERE IS A WAY TO FIX THIS.
2791
01:14:31,134 --> 01:14:32,135
WE DON'T HAVE TO LIVE
2792
01:14:32,135 --> 01:14:33,570
WITH THIS ONEROUS BURDEN.
2793
01:14:33,570 --> 01:14:34,638
WE DON'T HAVE TO CONTINUE
2794
01:14:34,638 --> 01:14:35,905
TO SAY, "OH, WE'RE LOSING GROUND
2795
01:14:35,905 --> 01:14:37,040
WITH THE CHINESE, LOSING GROUND
2796
01:14:37,040 --> 01:14:38,041
WITH THE MEXICANS." NONSENSE!
2797
01:14:38,041 --> 01:14:39,242
LET'S START GAINING NOW.
2798
01:14:39,242 --> 01:14:40,577
LET'S START EMPOWERING
2799
01:14:40,577 --> 01:14:41,645
AMERICANS AGAIN.
2800
01:14:41,645 --> 01:14:42,679
>> THE CURRENT SYSTEM
2801
01:14:42,679 --> 01:14:44,047
IS A DISASTER FOR OUR CHILDREN
2802
01:14:44,047 --> 01:14:45,048
AND GRANDCHILDREN.
2803
01:14:45,048 --> 01:14:46,683
DEMOCRATS AND REPUBLICANS ALIKE
2804
01:14:46,683 --> 01:14:47,884
CARE ABOUT THEIR CHILDREN.
2805
01:14:47,884 --> 01:14:48,885
>> THE REST OF THE WORLD
2806
01:14:48,885 --> 01:14:49,886
IS CHANGING.
2807
01:14:49,886 --> 01:14:50,887
THE REST OF THE WORLD
2808
01:14:50,887 --> 01:14:52,055
IS BECOMING MORE COMPETITIVE.
2809
01:14:52,055 --> 01:14:54,190
WE HAVE TO KEEP WORKING,
2810
01:14:54,190 --> 01:14:55,191
EVERY YEAR, TO BECOME
2811
01:14:55,191 --> 01:14:56,192
MORE COMPETITIVE,
2812
01:14:56,192 --> 01:14:57,193
AND A BIG PLACE TO DO THAT
2813
01:14:57,193 --> 01:14:58,061
IS IN THE TAX CODE.
2814
01:14:58,061 --> 01:15:00,063
>> I, FOR ONE, AM NOT CONVINCED
2815
01:15:00,063 --> 01:15:01,164
THAT UNHAPPINESS WITH
2816
01:15:01,164 --> 01:15:03,099
THE TAX SYSTEM IS GONNA BE
2817
01:15:03,099 --> 01:15:04,200
STRONG ENOUGH TO GET IT
2818
01:15:04,200 --> 01:15:06,703
TO CHANGE, UH, ON ITS OWN RIGHT.
2819
01:15:06,703 --> 01:15:07,971
I JUST-- I JUST DON'T THINK
2820
01:15:07,971 --> 01:15:10,139
THAT LAWMAKERS WILL MUSTER
2821
01:15:10,139 --> 01:15:11,140
THE WILL TO MAKE
2822
01:15:11,140 --> 01:15:12,208
A FUNDAMENTAL CHANGE
2823
01:15:12,208 --> 01:15:13,209
IN THE TAX SYSTEM
2824
01:15:13,209 --> 01:15:15,679
UNTIL THEIR HAND IS FORCED.
2825
01:15:15,679 --> 01:15:17,280
UM, WE'RE JUST WAITING
2826
01:15:17,280 --> 01:15:18,514
FOR THAT MOMENT.179239
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