Senator Tells Unemployed: US Faces Debt Crisis, Can’t Afford Benefit Extension

Video by Tracey Pollock
Quoting right-wing talking points, US Senator Ron Johnson (R)-Wisconsin, spars with unemployed and underemployed constituents in his Washington, DC office over unemployment benefits.

Senator Johnson brushes off constituents requests for increasing taxes on the rich, saying the US is facing a debt crisis and says we should be fearful of what is happening in Greece because it could spike interest rates and cost the US $1.2 trillion more in debt payments. Strangely enough, that’s approximately the same amount of money the US Treasury has lost because of the Bush tax cuts that Republicans have refused to let expire as they were slated to this year.

“We don’t have a debt crisis, we have a revenue crisis and we need the rich to pay their fair share” said one of Senator Johnson’s constituents. “If we increase taxes on the rich we can fund those programs that put people back to work right now. Bridges, roads, schools. We can put them back to work. Those are real jobs.”

“I’m concerned the disparity between the top and the bottom. I am”, says Senator Johnson. “The solution isn’t to tear the top down. The solution is to get our economy going again.”

That disparity according to Senator Johnson isn’t as large as others have described. He says the top 1% only earn 17% of the country’s wealth. However constituents crowding in his office quickly reminded him that the 1% controls 45% of the nation’s wealth.

Senator Johnson quotes Bush administration era statistics on government regulation costs.

Senator Johnson says regulation is costing “job creators” $1.7 trillion a year. He cites a survey from “the Obama administration… SBA”, which is based on data from 2008, the last year President George Bush was in office.

Since taking office, President Obama has pushed to reduce those costs, often to the dismay of environmental activists. Enforcing environmental regulations make up a the largest portion of the annual government costs for businesses.

This month it is likely Senator Johnson will have to vote on a proposal to maintain and increase the cut in payroll taxes that saved an average family about $1,000 this year. Republicans are split on the issue because to pay for it, taxes would go up on the richest Americans.

Senator Johnson told the group that he has signed a pledge to Republican strategist Grover Nordquist saying he would not raise taxes.

That prompted one of his constituents to say “You didn’t sign a pledge with us. How come that (the Nordquist pledge) is more important?”

Senator Johnson met with his constituents on December 7, 2011. They had driven to Washington as part of a “Take Back The Capitol” rally.

Below is a transcript of the edited video:
Austin (Constituent and organizer): By a show of hands, how many people in here are unemployed?
OK, now the Senator just said that if the government right now extends unemployment insurance for you and people like you, that is a hand out. That you’re going to be lazy and you’re not going to continue looking for a job. Of you that raised your hand, is that true?

Group: No

Austin: And here’s the issue. Senator, the Senator knows very well that its the problem is not that the government is involved. The problem is that corporations have record profits right now. They have more money than ever before in human history. Right now corporations have the money to put people back to work. What they aren’t doing is using that money to help people like you. So I think the question we need to ask is one… where are the jobs in Wisconsin that you promised when you ran for office? And question two… why won’t you make the rich pay their fair share in order to fund good jobs? Because we know that they’ve got the money, the question is what are they contributing to help us get back to work.

Johnson:
There’s a very large ideological divide in this country. So let me just try to explain my position.

Constituent: I think it’s about fairness not about ideology.
Constituent: You mean I can eat and somebody else might not be able to eat… is that the kind of ideology we’re talking about?

Johnson: So there’s a difference. Let me answer OK. Um. The only promise, by the way, that I made during the campaign, really the only promise, was that I would never vote for my re-election (unintelligible). I stepped up to the plate because we’re bankrupt in this nation. We’ve spent in the last three years, four-trillion dollars we don’t have. We’re going to spend another trillion dollars don’t have.

Constituent: How much in tax cuts?

Johnson: The total tax cuts under the Bush plan has been about 1.2 trillion , but that was going back to the 2000′s.

Constituent: Sir.

Johnson: If you let me finish. In terms, in terms of the rich paying their fair share, the IRS just released data from 2009. The top 1 percent earned about 17 percent of the income. The top one percent… and by the way the top one percent changes all the time. We actually still do have income mobility in this country. It’s true….17 percent. Their share of the income tax was 37 percent. So we do have progressivity in this. The top five percent paid about 58 percent of the income tax. The top 10 percent paid about 70 percent of the income tax. The top 50 percent pays about 98 percent of the income tax. So there is progressivity. I think we’re a very compassionate society we do want to see….

Constituent: How many taxes did GE pay for example last year?

Johnson: Understand, those are anomalies

Constituent: No

Johnson: Those are. Those are individual things whether they’ve got loss carried forwards, they’e got, by the way energy tax credits on wind turbines, there’s all…. I don’t particularly… I don’t support those things. I haven’t even had a chance to vote on those yet. I don’t like special deals. I don’t like crony capitalism.

Constituent: So do you support closing all the tax loopholes for these multi-national corporations?

Johnson: The true things that are tax loopholes and are specialty and some things like wind turbine tax credits that really don’t recognize the discipline of the free market place, I think businesses should be able to make it on their own without looking for government for support. I totally support that.

Constituent: Yes but the President put forth a jobs bill and didn’t it become political?

Johnson: Because, because it was going to spend another 500 billion dollars we don’t have and again…

Constituent: What does the deficit do with not having the money?

Johnson: The thing we all need to fear is if this country hits a debt crisis and our interest rates spike by eight percent like they did in Greece, that would, that would increase our interest payments by 1.2 trillion dollars. We’d wipe out all discretionary spending

Constituent: We don’t have a debt crisis, we have a revenue crisis and we need to make the rich pay their fair share.

Johnson: We have…

Constituent: If we increase taxes on the rich we can fund those programs that put people back to work right now.

Constituent: That’s right.

Constituent: Bridges, roads, schools. We can put them back to work. Those are real jobs.

Johnson: The Obama administration has their SBA do a study on how much does it cost to comply with government regulations. The study came back 1.75 trillion dollars. Now let me put that in perspective. This is the burden we’re placing on job creators.

Constituent: Those regulations keep us safe!

Constituent: But the CEOs are ripping off the profits. They’re not being bankrupted by the government. Their not bankrupted at all. They’re taking taking the profit off the top and shoving it in their own pockets instead making jobs. And we’re still making it easier and easier to do things like um, mine without regulation. You know what we’re saying ‘oh we need these businesses otherwise no one wilt have a job. But then why do we give them all of these loopholes and all this money back for like being such wonderful rich people. Then they don’t give us any of the jobs that they say they created when we give them these loopholes. They’re putting it all in their pockets. So as long as… you see corporations are earning record profits and higher margins versus what the people who work for them make, in history! So it’s not like the government bankrupting these people so they can’t create jobs. The government is bending over backwards and laying down and getting screwed by these corporations into giving up all regulation and still just pocketing the money.

Johnson: First of all, certainly I would never propose giving up all regulations. But 1.75 trillion dollars, to put it in perspective, is 12 percent of our economy. It’s a larger number than all but eight economies and that is, that is what we’re burdening our job creation with. I don’t think that makes a very attractive place for job creation. We also do have the highest corporate tax rate in the world.

Constituent: If we make people pay it!

Johnson: We compete…. and so they do.

Constituent: If consumer spending is 70 percent of the economy, how we supposed to make it if two percent of the people got all the money? I mean how we going to spend money keeping… is there some type of an ideology there with two percent of the people having all the money?

Johnson: Two percent of the people don’t have all the money. But again…

Constituent: But in consumer spending what …

Johnson: one percent, one percent of the population does have 17 percent of the income

Constituent: 45 percent of the wealth

Johnson: I’m concerned the disparity between the top and the bottom. I am. But again the solution isn’t to tear the top down. The solution is to get our economy going again.

Constituent: Senator

Johnson: And as somebody who has run a business

Constituent: I ran one too! Not as big as your’s, but I ran a business.

Johnson: I had to make decisions

Constituent: When he asked about a living wage, making sure people have to be able to live with their job, why do you talk about the corporate CEOs and not the regular people? He talks about a living wage and …

Johnson: I’m happy to address things like minimum wage, because the true effect of minimum wage is: let’s take a small business. No let’s talk about a small business that wants to hire more people. But if you put, if you put it minimum wage too high, you actually prohibit him from being able to create a job because he can’t afford it. What we’re doing is limiting the number of entry level positions so that people can actually get into the workforce, prove their worth to an employer. Bottom line: when you’re a good worker you don’t stay at minimum wage for long. Trust me on that.
(Crowd laughs)

It’s not universal. It’s not universal, but trust me as an employer, as an employer I certainly didn’t want to lose good employees. And so you actually have a better marketplace. And so if your employer is not paying you good wages and you’re a good worker, you go look for other places. Now that’s hard to do, that’s hard to do when we have such high levels of unemployment. But again I would get back to we don’t have a very attractive place for business investment.

Tracey Pollock: Senator, have you ever lived off of minimum wage before? Do you have any idea what it’s like for a family to live off of minimum wage.

Johnson: My first…

Pollock: How old were you? You were 15? Did you have children?

Johnson: My first job was for a $1.45 an hour. And again I worked full time. And I think the most number of hours I worked was going to college, was 96 in a week plus taking full workload.

Constituent: How much did college cost when went?

Johnson: It was a lot cheaper

Constituent: And how much was your rent?

Johnson: I was able to live at my parents house. OK?

Pollock: So you actually didn’t have to support yourself off of minimum wage. Is that what you’re saying?

Johnson: No. But I supported myself after I got my education.

Austin: So we want to ask you, right here while got the face of many unemployed and underemployed folks, are you going to support an agenda for good family sustaining jobs that are funded by making the very wealthy, the top two, top one percent pay their fair share of taxes or are you going to continue on the path of cutting away the future of the people in this room?

Johnson: I absolutely want to support everybody in this country to be able to build a good life for themselves and their family. We have a difference of opinion on how you go about doing that. You just said we’re cutting everything. The last ten years our federal government spent 28 trillion dollars. The current argument moving forward is President Obama, President Obama wants to spend 46 trillion dollars in the next ten years. The House budget, all these draconian cuts, would spend 40 trillion dollars. Now again the point being, I don’t think we’ll be able to borrow that much money. We’re going to hit a debt crisis. And then the problems you worry about now in terms of nine percent unemployment is going to pale in comparison to what happens when this country hits that debt crisis. So again, I am here because I’m concerned about the bankrupting of this country.

Constituent: Why don’t we raise taxes? We can solve the deficit. We can close the deficit.

Johnson: I want anybody, I want who wants to raise taxes to ask themselves a very, just one, two questions. How many jobs will that tax increase create? How many jobs will that help…how will that tax increase help our economy? What we need to do…

(Many people talk)

Constituent: If unemployment insurance comes up next week, and it’s a simple yes or no, which way will you vote? Yes or no?

Johnson: If we, we have to reform the … we have to pay for it. We have to find cost offsets and w should reform system.

Constituent: So if there is gridlock, will you just say yes we will do it for the people that are hungry right now? Yes or no?

Johnson: We need to pay for it so we don’t further bankrupt this nation. Thank you, thank you for….

Constituent: Did you sign the pledge with Grover Nordquist not to raise taxes?

Johnson: I don’t want ….

Constituent: Answer the question.

Johnson: I don’t want to increase taxes because I signed the pledge

Constituent: Did you sign the pledge?

Johnson: I signed the pledge because I don’t want to increase taxes

Constituent: You didn’t sign a pledge with us. How come that one’s more important?

Johnson: Thank you.

Full video of the meeting is below

Michael McIntee

Michael McIntee is a former network TV news executive with more than 30 years of broadcasting experience. He began his broadcasting career at the University of Minnesota's student radio station. He is an expert producer, writer, video editor who has a fondness for new technology but denies that he is a geek. More about Michael McIntee »

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